Rakesh Jhunjhunwala ups stake in MCX, adds 5 lakh shares; Big Bull’s stake now at just under 5%

Big bull Rakesh Jhunjhunwala has increased his stake in Multi Commodity Exchange during the January-March quarter. Data available on the stock exchanges show that Rakesh Jhunjhunwala bought 5 lakh shares of the company during the previous quarter, taking his stake in the company to 25 lakh equity shares. Earlier, at the end of the October-December quarter, the ace investors had 20 lakh shares of MCX to his name or 3.92% stake, this has now increased to 4.90%.

The share price of Multi Commodity Exchange has, however, not increased during the period. Since the end of last year, MCX share price has plummeted 12.58%. On December 31, 2020 the share price of MCX was trading at Rs 1,730 per share, at the end of March the same was down at Rs 1,512 apiece. Along with Rakesh Jhunjhunwala, mutual funds houses have also increased their stake in MCX. Mutual funds held 20.37% stake in the firm at the end of the October-December quarter, the same was up at 21.15% on March 31. Meanwhile, foreign portfolio investors have trimmed their holding. FPI’s stake was down at 36.23% from 37.06% earlier. 

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Rakesh Jhunjhunwala has continued to hold a 3.9% stake in MCX for the last since December 2016. The value of his total holding in the company stands at Rs 370.13 crore as of today with the stock price gaining 0.58% to trade at Rs 1,480 per share.

With the recent change in upfront margin requirement to 50%, intra-day cash volumes have been hit. A recent report by ICICI Securities highlighted that the biggest impact is in commodities with MCX Average daily turnover (ADTV) declining 24% in March over February. “ADTV declined by Rs 9,000 crore composed of Rs 6,300 crore due to change in volumes and Rs 2,700 crore due to change in prices. Higher upfront margin requirement will necessitate varied degrees of upfront cash depending on the underlying value, as a result of which one can expect the trades to move from high margin requirement segments (in absolute terms) to lower margin requirement (or ticket-size) items,” analysts at ICICI Securities said. The brokerage firm has a ‘Buy’ call in the scrip.