Multi Commodity Exchange of India Limited — Q3 FY26 earnings call

Call held 27 Jan 2026

Management summary

Multi Commodity Exchange of India Limited reported a robust Q3 FY26, with consolidated revenue, EBITDA, and PAT showing triple-digit year-on-year growth, driven by a significant surge in average daily turnover, particularly in bullion. The company attributes this performance to strategic product launches, increased market participation, and operational efficiencies, including warehouse consolidation for base metals. Management anticipates continued momentum but acknowledges the need for expenses to catch up with growth and the slow traction in index options.

Highlights

  • Strong financial performance with revenue up 121% YoY to INR 666 crores, EBITDA up 144% YoY to INR 527 crores, and PAT up 151% YoY to INR 401 crores.

  • Significant increase in average daily turnover (ADT) for futures and options to INR 7.5 lakh crores, representing a 220% YoY growth.

  • Bullion segment now contributes 69% of the average daily turnover, supported by successful product launches and increased participation.

  • Healthy growth trends observed on a 9-month basis, with revenue up 72% to INR 1,413 crores and PAT up 89% to INR 802 crores.

  • Proactive measures like consolidating warehouses for copper and addressing GST queries have contributed to a 156% QoQ and 77% YoY growth in base metals volumes.

Concerns

  • Expenses are noted to be "lagging our growth" and will need to normalize over time, implying potential future increases in operating costs.

  • Index options have seen "minimal traction" despite being launched, indicating a slower-than-expected uptake in this product category.

Key financials

  1. Revenue from Operations ₹666 Cr +121%YoY
  2. EBITDA ₹527 Cr +144%YoY
  3. Profit After Tax ₹401 Cr +151%YoY
  4. Average Daily Turnover (F&O) ₹7.5 lakh Cr +220%YoY
  5. Futures Revenue ₹227 Cr
  6. Options Revenue ₹380 Cr
  7. Float Income ₹45 Cr

What they filed

Q1 FY27: revenue up 88.2%, net profit up 103.4% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue286 301 291 373 374 +31%666 +121%889 +205%702 +88%
EBITDA179 193 160 241 242 +35%494 +156%665 +316%494 +105%
Net profit154 160 135 203 197 +28%401 +151%530 +293%413 +103%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

  • Base Metals
    156% Volume Growth
  • Bullion
    69% Share of ADT

Capital allocation

medium confidence
  • Capex Capex disclosed
    Yes. So Devesh, I think this is an ongoing exercise. This is a question, I think, probably in the last 2 quarters also, we've discussed. So, with growth and more importantly, with the expectation of growth is the continuous need to keep our technology up to date, ready for high resilience, high availability, high scalability, fully functional to manage all the volatility as well as growth that the environment offers. So, we will continue to be in investment mode as we have been in the past. And we see that as necessary, but also a positive part of where we stand in the business.

Guidance & targets

Volume

  • UCC Growth Momentum Volume · rest of the year and for some time now · Medium confidence continuing
    I think at least for rest of the year, we do expect to see a certain momentum continuing. And when I say rest of the year, let's say, for some time now, we expect this momentum to continue because there is headroom from where we stand today to what is the potential.

    — Praveena Rai

  • Volume Handling Capacity Volume · current · High confidence 3x to 4x current volume
    Yes. So, we are well placed for a certain multiple of the volume that we have faced right now. And I'm saying faced because it's been a big multiple over the previous quarter and that quarter over the previous quarter and so on. So if you look at this kind of a momentum, we are well placed for at least 3x to 4x kind of a volume.

    — Praveena Rai

  • Long-term Volume Readiness Volume · over time · Medium confidence 10x volume
    But our intention and objective is to really be ready for more. In fact, market is telling us to be ready for a 10x volume. We've spoken about it also. So that's the kind of readiness that over time in an efficient manner that we will build up.

    — Praveena Rai

Profitability

  • Expense Normalization Profitability · over time · Medium confidence normalize this over time
    And with reference to expense numbers, Chintan, we do believe that our expenses are lagging our growth in terms of what we really need, both from a technology and operating standpoint as we work towards the business opportunity -- sustained business opportunity as well as what the economic environment requires, what our market requires. So, we will be looking to normalize this over time, not necessarily from the standpoint of exactly where we stand.

    — Praveena Rai

What to watch in Q4 FY26

Dividend payout decision

After year-end (Q4 FY26 results or later)
Current Under review
Target Specific decision on dividend payout ratio

Why it matters

Important for capital allocation and shareholder returns.

this is a decision we'll take after the end of the year. We are in growth mode. We will take various requirements for capital into account as we look at what's the right thing to do from a dividend standpoint. So please hold until that point.

Risks & concerns

  • Competition from other exchanges and potential sharing of price discovery

    medium

    Management acknowledges the 'real' risk of competition but expresses confidence in its strategy focusing on growth, innovation, and robust risk management.

    Both acknowledged

  • Expenses lagging growth, requiring normalization

    low

    Management noted that expenses are 'lagging our growth' and will be normalized over time, implying potential future increases in operating costs.

    Management acknowledged

  • Minimal traction in index options

    low

    Index options have seen 'minimal traction' since launch, indicating slower-than-expected uptake in this product category.

    Both acknowledged

Q&A highlights

6 direct
Drivers of UCC growth and future outlook Direct
We have at the heart of this growth in UCCs, 2 contributing factors. One is really an exercise in exploring and aligning the user experience across members for commodity derivatives trading... Alongside that is also the fact of new members who have come into our fold... at least for rest of the year, we do expect to see a certain momentum continuing.

Provides insight into the underlying factors driving user growth and management's confidence in its sustainability.

Asked by Devesh Agarwal, IIFL Capital

Impact of increased deliveries on costs and short delivery liability Direct
So no, there is no additional cost to the company because these are managed as part of warehouse negotiations and what participants pay for the services... there are guidelines and rules that manage that circumstance, by way of penalties and so on and so forth.

Addresses potential cost and risk implications of physical deliveries, confirming that these are managed without additional burden on the company.

Asked by Devesh Agarwal, IIFL Capital

Technology investments and capacity for future growth Direct
This is an ongoing exercise... continuous need to keep our technology up to date, ready for high resilience, high availability, high scalability... we will continue to be in investment mode as we have been in the past.

Highlights the company's commitment to ongoing technology investments to support anticipated volume growth and maintain operational robustness.

Asked by Devesh Agarwal, IIFL Capital

Strategy for increasing volumes in base metals and traction for index options Partial
In base metals, we've already seen traction in the copper futures and options... Nickel, which we launched this year only, now we are seeing good volumes... On the index, while we did launch index options, we haven't seen the kind of traction we were expecting, however, on index futures, we have seen good traction building up.

Provides an update on product-specific performance, noting success in some base metals but slower uptake in index options, which could be a future growth area.

Asked by Amit Chandra, HDFC Securities

Revenue split between futures and options, and outlook on expenses Direct
the revenue from futures was INR 227 crores for this quarter and options INR 380 crores... we do believe that our expenses are lagging our growth... So, we will be looking to normalize this over time.

Gives a crucial breakdown of revenue sources and signals potential future increases in operating expenses as the company scales.

Asked by Chintan Sheth, Girik Capital

Capacity to handle future volumes and readiness for 10x growth Direct
we are well placed for at least 3x to 4x kind of a volume... But our intention and objective is to really be ready for more. In fact, market is telling us to be ready for a 10x volume.

Reassures investors about the platform's scalability and management's ambitious long-term volume targets, implying significant future growth potential.

Asked by Ansuman Deb, ICICI Securities

Risk of competition and sharing price discovery (like IEX) Direct
The risk is real. I think we appreciate it and we respect it. We need to be prepared for it... we are well positioned to act as the commodity derivative exchange for India.

Acknowledges a significant competitive risk in the sector but expresses confidence in the company's strategy to maintain its position.

Asked by Parikshit Gupta, Fair Value Capital

Dividend payout ratio and operating leverage Partial
this is a decision we'll take after the end of the year... We are in growth mode... we see good business momentum. We will also be looking to make sure that our spends do catch up with the growth... there will be efficiency, and I think a lot of efficiency is already there on the table.

Indicates that dividend policy is under review and links future operating leverage to balancing growth with necessary investments and maintaining efficiency.

Asked by Aditya Yadav, Transient Capital

2 min read 7 chapters

Detailed narrative

Strong Financial Performance in Q3 FY26

Multi Commodity Exchange of India Limited delivered exceptional results in Q3 FY26, with consolidated revenue from operations surging by 121% year-on-year to INR 666 crores. This robust growth translated into a 144% increase in EBITDA to INR 527 crores and a 151% rise in Profit After Tax to INR 401 crores. The company's performance reflects strong business momentum and effective operational strategies.

Surge in Average Daily Turnover and Bullion Dominance

The average daily turnover (ADT) in futures and options witnessed a remarkable 220% year-on-year growth, reaching INR 7.5 lakh crores in Q3 FY26. Bullion contracts emerged as a key driver, contributing 69% of the total ADT, supported by successful product launches like Gold Mini and Gold Ten Futures. This indicates deepening market participation and product breadth.

Base Metals Volume Growth and Operational Improvements

Base metals volumes experienced significant growth, with a 156% quarter-on-quarter and 77% year-on-year increase. This was primarily driven by strategic initiatives such as consolidating copper warehouses to a single center and engaging with the market to clarify GST-related queries for deliveries. The company is reviewing and rationalizing warehouses for other base metals to further enhance efficiency.

Ongoing Technology Investments and Scalability

MCX is committed to continuous investment in technology to ensure high resilience, availability, and scalability of its platform, especially given the significant increase in order volumes. Management stated the company is 'well placed for at least 3x to 4x kind of a volume' and aims to be ready for '10x volume' over time, indicating a proactive approach to infrastructure development.

Managing Competition and Regulatory Landscape

The company acknowledges the 'real' risk of competition from other exchanges but expresses confidence in its strategy focusing on growth, innovation, and robust risk management. Discussions with regulators regarding increased participation from banks/financial institutions and co-location facilities are ongoing, though specific updates are limited due to regulatory purview.

Expense Normalization and Operating Leverage

While revenue growth has been strong, management noted that expenses are 'lagging our growth' and will be normalized over time, commensurate with business opportunities and market requirements. The company expects to maintain efficiency while ensuring spends catch up with growth, contributing to future operating leverage.

Margin Management and Product Development

Margin requirements, particularly for volatile commodities like silver (around 25%) and gold (around 10%), are dynamically calculated using the EWMA model, ensuring risk management. While index options have seen minimal traction, index futures are gaining momentum, and the company hopes options will follow as contracts mature.

This is an AI-generated summary of a publicly available earnings call transcript.
View original transcript

More Financial Services earnings calls