MCX Share Price Jumps Following UBS' Target Price Increase

On Wednesday, Multi Commodity Exchange of India saw its share price rise over 4% after UBS raised its target price from Rs 7,000 to Rs 10,000, while maintaining a 'buy' rating. The brokerage firm cited several positive factors contributing to this upward revision.

UBS emphasised that the foundation for MCX's growth is solid, pointing to favourable market conditions and the introduction of new products. The volatility in key commodity prices is expected to boost trading volumes, with MCX's trading activity showing strong performance since April.

According to UBS, the average daily value of futures has increased by approximately 50% quarter-on-quarter, and the average daily volume of option premiums has risen by around 30% quarter-on-quarter. This growth trend is expected to persist amid ongoing geopolitical uncertainties.

Shares of MCX rose as much as 4.67% to Rs 8,600 apiece. It pared gains to trade 4.39% higher at Rs 8,577 apiece, as of 10:31 a.m. This compares to a 0.65% advance in the NSE Nifty 50.

The stock has risen 117.60% in the last 12 months. Total traded volume so far in the day stood at 3.7 times its 30-day average. The relative strength index was at 76.

Out of 11 analysts tracking the company, seven maintain a 'buy' rating, three recommend a 'hold' and one suggests 'sell', according to Bloomberg data. The average 12-month consensus price target implies an upside of 13.6%.