MCX shares declined by nearly 7% despite reporting a 54% increase in its Q4FY25 net profit, due to rising costs and lower sequential profits. Key factors impacting the results were a sharp rise in operating expenses, particularly technology and staff costs.
The Multi Commodity Exchange of India (MCX), a premier commodity derivatives exchange in India, saw its stock price drop by nearly 7% in today’s trading session, hitting a two-week low of ₹5,600 per share. This decline followed the company’s announcement of its Q4FY25 financial results, which, while showing a 54% year-on-year (YoY) increase in net profit, were negatively impacted by rising operational costs.
Founded in 2003, MCX has firmly established itself as India’s leading commodity exchange, with a dominant 98% market share in commodity futures contracts traded in FY2024-25. The exchange provides a platform for trading across various commodities including bullion, energy, base metals, agri-commodities, and sectoral commodity indices, and holds strategic partnerships with international exchanges and global trade associations.
Despite the strong YoY growth in profits, the company reported a sequential decline in its Q4FY25 net profit. The net profit of ₹135 crore for the quarter marked a 54% YoY increase compared to ₹87.87 crore in Q4FY24. However, this was a 15% decrease from ₹160.04 crore in Q3FY25. This drop in sequential profits was attributed to a surge in costs, which rose by 64% YoY to ₹152 crore, primarily due to higher technology-related expenses. Staff costs alone surged 50% YoY, reaching ₹46 crore, exceeding analyst expectations.
Revenue from operations for the quarter showed impressive growth, increasing by 60.68% YoY to ₹320 crore, up from ₹199.45 crore in Q4FY24. The company’s operating earnings before interest, tax, depreciation, and amortization (EBITDA) for the quarter stood at ₹189.35 crore, which was a 57% increase from ₹120.33 crore in Q4FY24, though lower than ₹216.1 crore in Q3FY25.
One of the bright spots was the significant increase in trading volumes, especially in options. The notional average daily turnover (ADT) for options surged by 94% YoY to ₹220,936 crore, reflecting strong demand. However, the options’ premium ADT saw a decline, falling to ₹3,288.63 crore from ₹3,613.14 crore in the previous quarter.
Looking at the full fiscal year, MCX reported a strong performance with a total income increase of ₹450 crore, reaching ₹1,208.86 crore, a 59% YoY growth. EBITDA for the fiscal year stood at ₹761.51 crore, a staggering 445% YoY increase from ₹139.70 crore. Net profit jumped 574% YoY to ₹560.04 crore, up from ₹83.11 crore in the previous fiscal.
Despite the impressive yearly performance, the company’s Q4 results, combined with the rising costs, led to the dip in MCX’s stock price. Investors were concerned about the sustainability of the company’s profitability amid increasing operational costs.
About MCX
The Multi Commodity Exchange of India (MCX) is India’s leading commodity derivatives exchange. It offers a platform for trading across various commodities and has maintained a dominant position in the Indian market. MCX is headquartered in Mumbai, Maharashtra, and is known for its diverse commodity offerings and its strategic partnerships both domestically and internationally.
