MCX Ltd had their Q3 FY 22 conference call on 31 jan 2022
“Capturing Options market and sustaining Futures contract as well.”
Here are the key takeaways…
“Capturing Options market and sustaining Futures contract as well.”
Here are the key takeaways…
Business update
- During this quarter the company has positive performance.
- One of the biggest commodity derivatives has set to target highest ever FY 22 future trades In terms of value.
- They own 92.9% of their commodity futures market share.
- During this quarter the company has positive performance.
- One of the biggest commodity derivatives has set to target highest ever FY 22 future trades In terms of value.
- They own 92.9% of their commodity futures market share.
- MCX has divided its business into 5 parts, In which precious metals contribute 40% approx and energy contribute 35% approx.
- Compared to Q3 FY21 There has been a huge surge in their Options ADT.
- For it’s growth to new highs they are increasing their terminals and areas.
- Compared to Q3 FY21 There has been a huge surge in their Options ADT.
- For it’s growth to new highs they are increasing their terminals and areas.
- The companies ADT options premium turnover is around 107.4 for this period.
- In metal space company witnessed deliveries over 193000 tonnes of metal since conversion.
- They have designated warehouses in Thane, Raipur, Chennai, Kolkata and NCR.
- In metal space company witnessed deliveries over 193000 tonnes of metal since conversion.
- They have designated warehouses in Thane, Raipur, Chennai, Kolkata and NCR.
- In precious commodities front, the company has strong delivery in their aluminium space and has witnessed huge fall in zinc deliveries.
- There has been some ban on the crude oil contracts as well.
- There has been some ban on the crude oil contracts as well.
- On new client collaterals , it will also be mentioned on dealings soon.
- They also plan to upgrade their digital platforms through TCS.
- International bullion exchange has done good so they are expected positive response in coming periods.
- They also plan to upgrade their digital platforms through TCS.
- International bullion exchange has done good so they are expected positive response in coming periods.
- In electricity derivative, a joint committee is formed to deal and creation of contacts.
- This is all under Supreme Court dealing and Sebi’s.
- The additional margin case, impact has been decreased to lowest levels and are under all observation as well.
- This is all under Supreme Court dealing and Sebi’s.
- The additional margin case, impact has been decreased to lowest levels and are under all observation as well.
- They are also solving Gst challenges like for EGdr’s and post solution it will help revenue to new levels.
- On margins requirement, the cash part might increase from 10% to 40-50% as per the govt dealings and brokers says that going on building them
- On margins requirement, the cash part might increase from 10% to 40-50% as per the govt dealings and brokers says that going on building them
- They also plan to shift to the TCS platforms by September mid.
- On delivery volumes, they had 50:50 dealing in morning and afternoon and it is expected to change towards 45:55 where 45 is for the morning dealing’s.
- On delivery volumes, they had 50:50 dealing in morning and afternoon and it is expected to change towards 45:55 where 45 is for the morning dealing’s.
- The company is very bullish to on the options space to pick up and looking at the flow for options in other indices on other exchanges it has the potential to be top earner as well.
- On tcs platform, post September the company expect to have fixed flow due to 6 years contract and post that they pay amc of a single digit figure for full year.
- This total hardware and software set up cost was not spoken by the management.
- This total hardware and software set up cost was not spoken by the management.
- On notional they have 3:1 option:volume trade contacts.
- The futures won’t be affected by options as it will be used for the hedge strategies for their clientele.
- On time line of issuing delivery, They haven’t faced any delay and they expect to sustain the same.
- The futures won’t be affected by options as it will be used for the hedge strategies for their clientele.
- On time line of issuing delivery, They haven’t faced any delay and they expect to sustain the same.
- The drop 2 for platform has been delivered and all contract formats are also released to back office vendors who support number related issues.
Financials
- The operating revenue has declined by 11% during this period.
- Similarly their EBITDA had witnessed a decline to rupees 52.78 cr.
- Compared to Q3 FY22 their Pat levels declined to 34.46 crores.
- The operating revenue has declined by 11% during this period.
- Similarly their EBITDA had witnessed a decline to rupees 52.78 cr.
- Compared to Q3 FY22 their Pat levels declined to 34.46 crores.
- Even with decline quarter they hope to get things soon back to track.
- On turnover space compared to last quarter they grew in small percentage.
- On cost front, The company has been able to keep their cost under control and with new business they are positive for future.
- On turnover space compared to last quarter they grew in small percentage.
- On cost front, The company has been able to keep their cost under control and with new business they are positive for future.
- On tax rates, for FY22 it was expected to be around 18% but at present it is expected to increase to a higher number.
Investments
- To increase their scale, banks are allowed to serve as PCM.
- With mutual fund and Pms entry to invest in Exchanges they plan to invest more for smooth operating of the new businesses.
- To increase their scale, banks are allowed to serve as PCM.
- With mutual fund and Pms entry to invest in Exchanges they plan to invest more for smooth operating of the new businesses.
- They also launched iCOMDEX BULLDEX, METLDEX and ENRGDEX futures in this period for better deals for its client base.
- They have also undertaken initiatives for electricity derivatives to capture new areas.
- They have also undertaken initiatives for electricity derivatives to capture new areas.
- MCXCCL a 100% subsidiary of mcx has SGF of 510.96 cr as on dec 31,2021.
- The subsidiary has state of art risk management system using SPAN based value at risk margining model.
- The subsidiary has state of art risk management system using SPAN based value at risk margining model.
- Company keeps a close eye on the equity markets looking at its structure and future and options flow and keeping that in mind they launch products.
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