🧠 At a Glance
CDSL, once just a “behind-the-scenes” capital market plumber, is now a ₹36,000 crore fintech war machine. With 68% stock CAGR in 5 years, explosive demat account growth, and dividend payout of 50%, it has gone from “what’s a depository?” to “I wish I bought it in 2020.”
🏢 About the Company
- Full Name: Central Depository Services (India) Ltd
- Ticker: NSE: CDSL
- Business: Provides electronic depository services, enabling holding & settlement of securities in dematerialised form.
- Clients: Stock exchanges, brokers, investors, mutual funds, corporates.
- Notable Offerings:
- e-Voting
- M-Voting
- MyEasi App
- e-Locker (because who needs bank lockers when you’ve got cloud?)
👨💼 Key Managerial Personnel
- Chairperson (from July 2025): Shri Gurumoorthy Mahalingam (Ex-RBI)
- CEO/MD: Nehal Vora
- Fun Fact: CDSL is not government-owned, unlike NSDL. Promoter holding? Just 15% — a major contrast from typical PSU domination.
💰 Financials – 5-Year Overview (FY21–FY25)
| Metric | FY21 | FY22 | FY23 | FY24 | FY25 |
|---|---|---|---|---|---|
| Revenue (₹ Cr) | 344 | 551 | 555 | 812 | 1,082 |
| Net Profit (₹ Cr) | 201 | 312 | 276 | 420 | 526 |
| EPS (₹) | 9.59 | 14.89 | 13.20 | 20.05 | 25.20 |
| Operating Margin % | 62% | 66% | 57% | 60% | 58% |
| ROE % | 31% | 40% | 30% | 40% | 42% |
| Dividend Payout % | 47% | 50% | 61% | 55% | 50% |
📌 CAGR Highlights:
- Revenue CAGR (5Y): 37%
- PAT CAGR (5Y): 38%
- Stock CAGR (5Y): 68% 🔥
📊 Segment Performance & Business Model
- Core Revenue: Annual Issuer Charges, Transaction Charges, IPO & Corporate Action processing
- New Revenue: KYC, e-services, and a huge push in digital adoption post-COVID
- Customer Base Explosion: Number of demat accounts grew from ~3 crore in FY20 to over 10 crore+ now
- Zero Debt: Almost insultingly clean balance sheet
🏦 Balance Sheet Evolution
| Year | Net Worth (₹ Cr) | Borrowings | Cash Flow from Ops (₹ Cr) |
|---|---|---|---|
| FY21 | 877 | 0 | 193 |
| FY25 | 1,760 | 3 | 543 |
- Investments now: ₹1,351 Cr — earns solid other income each year
- Capex jump: Fixed assets rose from ₹73 Cr in FY21 to ₹446 Cr in FY25 (possibly infra & tech infra boost)
📈 Peer Comparison (as of June 2025)
| Company | P/E | ROCE % | Net Profit (Q4 FY25) | CMP (₹) |
|---|---|---|---|---|
| CDSL | 69.1 | 41.9 | ₹100 Cr | 1,739 |
| KFin Tech | 63 | 34.2 | ₹85 Cr | 1,217 |
| CAMS | 47.4 | 57.2 | ₹106 Cr | 4,229 |
➡️ Valuation Hot Take: Trading at 20x book and P/E 69 — a bit spicy. But growth justifies it (for now).
📉 Shareholding Trends
- Promoter Stake: 20% ➡️ 15% (fell since FY23)
- Public Holding: 45% ➡️ 58% 🧑🤝🧑
- Mutual Fund & FII interest: Strong but volatile — FIIs down from 18% to 11% in a year
- Total Shareholders: Shot up from ~8 lakh to 15.3 lakh — retail going brrr 💸
🔮 Forward Fair Value (EduAssumption Model)
Using peer P/E average (CAMS/KFin ~55) + 20% growth assumption:
- Base Case EPS FY26E: ₹30–32
- Fair Value Range: ₹1,650–₹1,850
- Current Price: ₹1,739 → near the upper bound already
- Verdict: Not cheap, but not delusional either. Valuation premium = high quality + monopoly vibes.
🧾 Why CDSL Stands Out
- Only 2 depositories in India (other = NSDL, privately held)
- Every new demat = revenue — perfect compounding model
- Leverages India’s retail participation surge + IPO boom
- High margin, low capex, no debt = dream fundamentals
- But… valuations now factor in a LOT of future good news
🕵️ Risks & Red Flags
- 🟠 Working Capital Days shot up: from -22 to 207 in FY25 😬
- 🔴 Promoter exit trend: From 20% ➝ 15%, no signs of stopping
- 🟠 High valuation risk: Any slowdown in demat growth or IPOs could hurt sentiment
- 🔴 Arbitration claim: ₹19.3 Cr by Bulchandanis — not material, but still…
🧠 EduInvesting Take
If CDSL were a college student, it’d be the frontbencher with a startup, 10 internships, and still tops the class. But now that everyone’s noticed, the pressure is on.
If you discovered it in 2020, congrats. If not — it’s like entering IIT after 3 attempts: still valuable, but expectations are already sky high.
Author: Prashant Marathe
Date: 12 June 2025
Tags: CDSL, Depository, Stock Market Infrastructure, 5-Year Recap, NSE, Fintech, IPO Boom, CAMS, KFin Technologies, EduInvesting
