MCX Stock Soars 198% in a Year: Is It Still a Buy? Experts Reveal Key Technical and Fundamental Insights!

MCX (Multi Commodity Exchange of India) has seen a significant rise in its stock price, climbing 198% over the past year. In 2024 alone, the stock has gone up by 68%, showing positive growth in seven of the nine months so far. In September, it added 4%, marking its fourth straight month of gains. The stock increased by 21% in August, 9.3% in July, and 8% in June, even though it dropped by 11.5% in May.

Between February and April, the stock was volatile. In April, it rose by 22.7%, fell by 11% in March, and gained 10.2% in February and 6.7% in January. Today, the stock reached an all-time high of ₹5,420, which is a 218% jump from its 52-week low of ₹1,701.30 in September last year.

Expert Views

Many investors are wondering if MCX’s stock will continue to rise. Here’s what market experts have to say:

• Pravesh Gour, Senior Technical Analyst at Swastika Investmart, says MCX has broken out of a “flag pattern” on its weekly chart, which indicates that the stock is headed for higher highs. It is trading above all its moving averages (SMA), showing strong momentum. However, he warns that the stock may face resistance at ₹5,500 and advises a buy-on-dip strategy, suggesting ₹4,800-₹5,000 as a good entry zone. His target is over ₹6,000, with a stop-loss at ₹4,600.
• Rajesh Palviya, SVP of Technical and Derivatives Research at Axis Securities, notes that MCX is in an upward trend with strong support zones at ₹5,120-₹5,000-₹4,760. He advises maintaining long positions with a target of ₹5,515-₹5,750, noting that minor corrections should be viewed as buying opportunities.
• A.R. Ramachandran, Co-founder of Tips2Trades, suggests that although MCX is bullish, it is currently overbought on the daily charts. He recommends booking profits now as the stock could fall to ₹4,510 if it closes below ₹5,134.

Financial Performance

MCX, India’s biggest commodity exchange, posted impressive numbers for the June quarter. Net profit jumped over four times to ₹111 crore from ₹20 crore last year, thanks to higher trading volumes. The company’s total income also grew 54% to ₹228 crore, up from ₹148 crore last year. EBITDA rose significantly to ₹151 crore from ₹31 crore.

Additionally, the MCX Board approved a ₹10 crore investment in India International Bullion Holding IFSC, showing their focus on expanding strategic partnerships.

Broker Recommendations

• HDFC Securities has a buy rating on MCX with a target price of ₹6,000, citing strong growth potential, especially with the launch of new products and focus on increasing institutional participation. Despite some regulatory challenges, the brokerage sees a strong future for MCX, projecting a compound annual growth rate of 61% for volume and 43% for premium between FY24 and FY27.
• ICICI Securities has a hold rating on the stock with a target of ₹5,348. While the brokerage acknowledges strong volume growth in options and futures, it remains cautious about future trends. They see limited upside in the current valuation, and forecast further growth will depend on significant gains in futures and options volumes.

In summary, experts are optimistic about MCX’s future but recommend caution due to its current high valuation and potential market volatility.