Shares of Multi Commodity Exchange of India (MCX) have been losing ground in the last one month. Fall in the share price of the only listed exchange comes in the midst of introduction of commodity transaction tax (CTT), share sales by some of the top officials of the bourse and a failed attempt by an institutional investor to exit the comex.

MCX has seen its share price drop from R1,200 to R904 in the last one month ? a drop of 25% at a time when the benchmark Sensex lost only 3.20%. In November last year, the stock had touched its all-time high of R1,617. MCX made its debut on the bourses in March 2012 and issue price was fixed at R1,032.

Interestingly, the fall in the share price also comes close on the heels of the top brass of the exchange selling shares at regular intervals. According to stock exchange disclosures, the recent past saw Paras Ajmera (non-executive director & FTIL nominee), Joseph Massey (non-executive director), Shreekant Javalgekar (MD & CEO), Dipak Shah (director, market operations), Parveen Kumar Singhal (deputy MD) and Sameer Patil (senior vice president) all selling shares in the secondary market.

Meanwhile, even as the top officials were selling shares in the market, NYSE Euronext, which bought a 5% stake in MCX in June 2008, was finding it difficult to off-load its entire holding. According to reports, NYSE Euronext had to call off its plans to sell its stake in MCX for about $45 million due to poor response from investors.

According to market intermediaries, the commodity exchange is witnessing an overhang due to the recent imposition of the commodities transaction tax (CTT) along with the expiry of the lock-in period of the institutional shareholders who were allotted shares prior to the public offer.

?Overall, imposition of CTT will adversely impact MCX?s volumes with a similar effect on earnings as well. However, over the past three months, anticipation of CTT and the lock-in expiry of institution-owned shares have dented MCX scrip,? said a recent Edelweiss report.

Market players say near future could see a number of other institutional investors ? who were allotted shares as part of the pre-IPO placement – trying to sell their shares in the market. ?As one year lock in period for pre-IPO investors is getting over on 8th Mar 13, we may see some more selling pressure in the stock in near term,? stated a report dated March 7 by Sunidhi Securities & Finance.

It is believed a total of four crore shares would be unlocked that were mostly allotted to public sector banks at the face value of Rs 10. Even at the current market price of R905, the investors would be able to book significant profits provided there are enough buyers.

In red zone

* Shares of MCX have lost over 25% in one month; Sensex is down only 3.20%

* Top officials of MCX have been selling shares at regular intervals

* Last month, govt started commodities transaction tax as part of the Budget

* CTT expected to hit non-agri commodity turnover as cost of trading rises

* On March 7, NYSE Euronext called off sell 4.8% stake sale in MCX on poor response

* NYSE Euronext bought 5% stake in MCX in June 2008