At a Glance

India’s only listed depository might not be flashy like Zomato or sexy like Tesla, but CDSL is the plumbing that makes stock trading even possible. While we meme over IPOs and PSUs, CDSL is quietly minting money by storing your shares, collecting fees, and laughing all the way to the bank — with a 37.8% profit CAGR.

📦 What Does CDSL Even Do?

Imagine the stock market as a casino. CDSL is not the gambler, not the dealer, not even the chips.

It’s the freaking vault that stores your money.

• It holds your demat shares, ensures they’re safe, and facilitates their transfer.
• It’s used by brokers, exchanges, clearing corps, mutual funds, and even the GOI.
• Services: demat, remat, e-voting, KYC, e-locker, Myeasi app, etc.
• The less sexy it sounds, the more money it makes.

And guess what?

🧠 Market Share?
💣 100% in precious metals
💣 99.8% in base metals
💣 95.9% overall in commodity futures (as per FY24)

CDSL = Monopoly = Moat = Margins

📈 5-Year Financial Recap (FY20–25)

This is what financial foreplay looks like — consistent compounding without drama.

📊 FY25 Quarterly Chaos

Let’s decode the elephant in the room: Q4 FY25 was a flop.

• Revenue: ₹224 Cr (down from ₹278 Cr in Q3)
• Net Profit: ₹100 Cr (down from ₹130 Cr)
• OPM: Crashed to 49%, the lowest in 2 years

Reason?
Volume drop, regulatory pricing changes, and SEBI suddenly deciding it wants to look useful.

But chill — CDSL is a volume business. New account openings = future gravy train.

🤯 Strengths

• Debt-free. Always has been. Like that one CA in the friend circle.
• Massive profit margins (58% in FY25).
• Zero capex risk – their assets are servers, not steel.
• Regulated by SEBI – which means it has a license to kill bill.
• Digitally scalable – new DPs, IPO boom, MF folios, etc., all flow through CDSL.

😬 Weak Spots

• Promoter Holding: Just 15%
  • And falling — used to be 20% three years ago.
• High Working Capital Days (207 days in FY25 from 22 last year!)
  • Translation: Receivables have ballooned; someone isn’t paying on time.
• Valuation? Uff.
  • P/E is nearly 67x. Price-to-Book? A spicy 20x.
  • That’s higher than your gym trainer’s protein powder cost.

🆚 Peers: A Tale of Three Techies

🤔 CDSL is the only listed depository. The others are registrars (RTAs).
Different niches — but investors club them together.

🧮 Fair Value Range: ₹1,300–₹1,550

Let’s break it down:

• EPS TTM: ₹25.2
• Reasonable P/E for monopolistic infra biz: 52x–61x
• FV = ₹25.2 × 52 = ₹1,310
• Upper FV = ₹25.2 × 61 = ₹1,540

👀 Current Price: ₹1,686
So yes, CDSL is slightly ahead of its FV range, thanks to IPO mania + retail account surge + FOMO.

But this ain’t a bubble yet — just a mild froth.

🔮 What’s Next?

• 🚀 15.3 lakh retail shareholders = India’s love for equities is booming
• 🧾 SEBI’s new regulations (e.g., e-KYC) will bring new business
• 🧑‍💻 As more Indians enter capital markets, CDSL earns every time a new demat account is created, maintained, or sneezed on

That’s called a non-linear business. Sleep and earn.

🧠 Edu Take

“CDSL is what happens when you sell shovels in a gold rush — except the gold rush is demat accounts, and you own the entire mine.”

If you want consistent compounders that don’t chase headlines — CDSL is your guy.
But don’t expect discounts at 67x P/E. If it ever drops back to 50x range, it’s your lucky day.

Tags: CDSL, Depository, Monopoly Stocks, Indian Stock Market, NSE, Demat Accounts, Stock Investing India, SEBI, KFin Tech, CAMS, EduInvesting

✍️ Written by Prashant | 📅 June 22, 2025