MCX Shares Surge: Is the Rally Justified? – A Fundamental Analysis

Shares of Multi Commodity Exchange of India Ltd (MCX) rose as much as 3.32% on Thursday, February 19, 2026, after the exchange and the National Stock Exchange of India (NSE) announced the withdrawal of additional margins on gold and silver futures contracts, effective immediately. The move aims to ease trading costs following recent price corrections in the bullion market.

MCX had imposed a 3% additional margin on all gold futures contracts and a 7% margin on silver futures earlier this month, while NSE Clearing Limited had implemented similar measures of 3% on gold and 7% on silver on February 4. Both exchanges have now reversed these decisions, responding to a cooling in precious metal prices.

The withdrawal of these margins comes after a period of significant volatility. Silver prices soared 170% in 2025 and climbed over 70% in the first two months of 2026 before sharply reversing course, falling 42% from a January 29 record high of Rs 4.20 lakh. Gold also experienced a correction, slipping 20% from its peak of Rs 1.93 lakh. These price swings initially prompted the increased margin requirements as risk management measures.

According to ICICI Securities, gold spot prices have declined 10% since the start of February, while silver spot prices are down 33%. The brokerage noted that margin changes remain a recurring possibility, particularly during periods of heightened volatility.

The impact of increased margins was evident in trading volumes. Gold futures average daily turnover (ADTV) fell 41% month-on-month to Rs 33,600 crore in February 2026-to-date, while silver futures ADTV declined 58% to Rs 22,700 crore over the same period. However, mirroring a similar situation with crude oil futures in 2020, options activity has increased. Premium turnover as a share of overall turnover in gold and silver options rose in late January and February 2026, suggesting a shift in trader preference.

In 2020, MCX increased margin requirements on crude futures amid negative pricing during the Covid-19 pandemic. This led to a plunge in crude futures ADTV from Rs 17,200 crore in February 2020 to Rs 3,300 crore in April 2020, but simultaneously saw a surge in crude options premium ADTV, increasing from around Rs 5.5 crore in FY21 to Rs 2,120 crore in FY25 and Rs 2,400 crore in FY26-to-date.

ICICI Securities projects MCX’s futures ADTV at Rs 66,500 crore in FY26, rising to Rs 80,000 crore in FY27 and Rs 90,000 crore in FY28. Options premium ADTV is estimated at Rs 6,200 crore in FY26, Rs 8,100 crore in FY27, and Rs 9,500 crore in FY28. The brokerage has an ‘Add’ rating on MCX with a target price of Rs 2,780 per share, representing a 19% upside from current levels.