According to analysts, the MCX share price fell more than 5% due to mixed Q4 earnings.

The share price of the Multi Commodity Exchange of India (MCX) experienced a notable decline of over 5% during Wednesday's trading session, prompted by the release of its mixed financial results for the fourth quarter of the fiscal year 2023-24. Beginning the day with an intraday high of ₹4,015, the MCX share price subsequently plummeted to an intraday low of ₹3,800. Equity technical and derivative analyst Rajesh Bhosale, from Angel One, remarked on the negative market reaction following the quarterly results, indicating that while the overall trend remains positive, market dynamics in the near term will be crucial. Bhosale pointed out that the next significant support level for the stock stands at 3600, while surpassing the 4000 mark would signal a resumption of its upward trajectory.

In terms of financial performance, MCX reported a total income of ₹153.83 crore for the quarter ended March, representing a year-on-year increase of 29.66%. However, this figure was slightly lower than the income recorded in the corresponding quarter of the previous year. Despite the revenue growth, the company's profit surged significantly to ₹87.9 crore, marking a sixteen-fold increase compared to the same period in the previous fiscal year. Notably, the profit margin also saw a substantial improvement, rising to 56.3% from a mere 1.6% in the previous year.

Analysts at ICICI Direct brokerage Research noted that MCX's performance in Q4FY24 was mixed, with growth in options volume but a decline in futures volume. Operating revenue saw a slight decrease, primarily attributed to a reduction in software expenses. However, the brokerage highlighted the importance of monitoring management commentary on new product launches for future insights.

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Meanwhile, global brokerage Morgan Stanley maintained its underweight rating on MCX and kept its target price at ₹2,085, suggesting a potential downside of over 48%. The brokerage expressed concerns over the company's Q4 profit after tax (PAT) projections, which significantly missed consensus estimates. Additionally, the brokerage emphasized the need for further details regarding costs, which exceeded expectations by a considerable margin.

Overall, the market's reaction to MCX's Q4FY24 results reflects a complex mix of factors, including revenue growth, profit margin improvement, and concerns over missed projections and elevated costs. As investors await further insights and management guidance, the stock's performance in the coming days will be closely watched to gauge market sentiment and potential future trends.

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