MCX Q4 Review - Lower Costs To Give Margin Lift: ICICI Securities
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ICICI Securities Report
Three key takeaways from Multi Commodity Exchange of India Ltd.'s FY21 result concall were:
- significantly lower software costs under the new contract with Tata Consultancy Services Ltd., partially offset by higher depreciation;
- some of the cost savings achieved in FY21 may be sustainable; and
- management positivity around the expected new gold exchange.
Not only does the management expect gold futures volumes to be sustained, it also believes the company has a ‘right to win’ from any new gold exchange initiative.
Reduction in costs results in an upgrade in our operating earnings for FY23E.
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