21 Jan , 2025 By : Debdeep Gupta
Shares of Multi Commodity Exchange of India (MCX) crashed 10 percent on January 21. This comes after brokerage Morgan Stanley issued an 'underweight' call for the stock, stating that the firm's Q3 net profit has fallen below its estimate.
At 11:20 am on January 21, MCX shares were trading nearly 11% lower at Rs 5,388 apiece.
MCX had released its quarterly results for October-December in the post-market hours of January 20. The company reported a net profit of Rs 160 crore in Q3FY25, marking a strong comeback from the Rs 5.35 crore loss it had reported for the corresponding quarter of the previous financial year.
MCX reported a total income of Rs 324 crore in Q3 of FY25. This marks an increase of over 55 percent from the Rs 209 crore income it reported in Q3 of FY24.
The company's earnings per share (EPS) turned positive to stand at Rs 31.38 during the reported quarter. EBITDA stood at Rs 216 crore in Q3.
During the nine months between April and December, precious metals and stones covered the lion's share in MCX's turnover at 65.22%. They were followed by energy (22.4%), base metals (12.28%), agricultural commodities (0.04%), and index futures (0.05%).
Notably, only "fit and proper" persons are eligible to deal in the shares of MCX. "Shareholders who intend to acquire beyond five percent would have to take prior approval from SEBI," the company said.
What did Morgan Stanley say about MCX stock?
The brokerage kept a target price of Rs 3,715 apiece for MCX shares while keeping a 'underweight' call on the stock. The target price implies a 31?cline from the current price of Rs 5,415.65. Morgan Stanley said while EBITDA was in line, MCX's net profit has missed its estimates. It added that it finds the current valuation stretched given the low conviction on the sustainability of revenues.
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