Central Depository Services (India) Limited — Q2 FY24
CDSL reported a strong Q2 FY24 with consolidated total income of INR 230 crore (+35% YoY) and net profit of INR 109 crore (+35% YoY), driven by robust Demat account additions (8...
bullish
high
✓ Verified against BSE filing
Claim Ledger
Did management answer the analysts?
Every material analyst question, graded on whether management actually answered it — with the verbatim exchange and quantitative claims checked against filed numbers.
46%Questions answered5Evaded / deflected12Questions auditedContradictedNumbers vs filing
Evasive
High priority
Breakup of IPO/corporate action revenue and stickiness
Asked by Swarna Mukherjee, B&K Securities
Management declined to provide any breakup or stickiness assessment, citing unpredictability.
no breakup givenrefused to quantifydeferred to market conditions
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Question
First one on the, IPO corporate action, line item. So I just wanted to understand, you know, how much of this, growth can be kind of sticky. So if you could give us some color or a quantifiable breakup on how much of this has come due to IPOs, how much through AGMs, et cetera, and how much through corporate actions.
Sunil Alvares, Managing Director and CEO, CDSL Ventures Limited
On your first question on IPO and credit corporate actions, it's kind of market-driven, so it's kind of difficult to predict, and we don't give any future pretty reference points, so we would not able to kind of give a picture of the future.
Evasive
Medium priority
Reason for strong KYC/KRA performance
Asked by Swarna Mukherjee, B&K Securities
Management did not provide a specific reason or breakup for KYC growth.
no bifurcation givenattributed to multiple factorsrefused to specify
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Question
Secondly, on the KYC, KRA business, if you could, you know, give us a sense why this, you know, the performance has been very strong, so whether the share of Fetch transactions have increased, or is it like the mix is relatively similar and volume-driven, because of which the growth has come?
Nehal Vora, Managing Director and CEO, CDSL
It's difficult to predict what has caused this outcome. It's kind of the overall buoyant market conditions, what has led to whether it's Fetch or increased KYC opening. It's a culmination of variety of factors, and it plays one upon the other.
Partial answer
Medium priority
Technology cost run rate and other expenses
Asked by Swarna Mukherjee, B&K Securities
Management acknowledged ongoing investment but did not indicate whether costs will stabilize.
no specific guidance on peakgeneral statement about ongoing investment
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Question
Thirdly, on the cost side, so if I look at the tech cost, so, about a year back, it was somewhere around INR 9- INR 10 crores. It has steadily moved up from INR 15 crore run rate this quarter. So are we peaking out in terms of the run rate, or should we expect further increase in this?
Nehal Vora, Managing Director and CEO, CDSL
The cost on the technology cost is something which is a constant, but as we are growing in number of accounts, we have to plan... So it's going to be a constant in investment, which we will continue to do as we move forward.
Evasive
High priority
Demat account additions and revenue contribution
Asked by Amit Chandra, HDFC Securities
Management did not address the declining revenue per account, instead focused on long-term ecosystem.
no direct answer on revenue per accountreframed as long-term building blocks
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Question
But if I see the revenue for Demat, it has been coming down, and if I see the revenue for incremental Demat, it is also, you know, coming down. So how do you see the, like, newer account additions that are happening? So these are not contributing much to revenues.
Nehal Vora, Managing Director and CEO, CDSL
So on the first question, Amit, is more of the building blocks getting created in terms of number of Demat accounts. How the investors will react to, as a group or as a collective group, will be dependent on how the market conditions are, et cetera.
Answered
High priority
Private companies Demat opportunity and timeline
Asked by Amit Chandra, HDFC Securities
Management provided a clear timeline (September 2024) and confirmed readiness.
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Question
Secondly, on the, on the private companies, Demat opportunity that has come up recently, there are around INR 14 lakh MCA-registered private companies, and, taking the lower slab, that comes to a bigger opportunity. So is there any timelines in terms of, you know, these companies getting, like, Dematted?
Nehal Vora, Managing Director and CEO, CDSL
On the second question, MCA has just, you know, recently put out this regulation. I think the timelines are given by, by September 2024, if I'm not mistaken. So I think, we are anyways, been doing this for a long time.
Partial answer
Medium priority
Driver of annual issuer charges growth
Asked by Prakash Kapadia, Ambit Portfolio
Management gave qualitative drivers but no numbers to quantify the contribution.
no quantitative breakupqualitative only
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Question
If I look at annual issuer charges, they are at the run rate of around INR 63 crore, which is, you know, a huge bump up on a year-on-year basis. Even last quarter, I think we were at this rate. So if you could give us some qualitative flavor on, you know, what is leading to this?
Nehal Vora, Managing Director and CEO, CDSL
The pricing impact is obviously put out in a public domain. It's. There's no change there. But it's a combination of both the first two factors. It's the increased number of private companies coming into the fold, as well as number of folios in increasing.
Answered
Medium priority
Reason for faster growth in SEBI fees vs depository revenue
Asked by Paresh Sangani, Club Millionaire
Management clearly explained the mechanism and why SEBI fees grew faster.
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Question
And then regarding the SEBI charges, Girish, you know, I saw that that's gone up by 50%, even though the revenues from a depository side are just up to 33%. Has there been any change or what actually led to a faster growth in SEBI fee this time compared to our depository revenues?
Girish Amesara, CFO, CDSL
The SEBI fees are basically based on the collection and not revenue. So if we have collected, say, revenue of previous year or, you know, before three years, then we have to pay 2% of those collected amount to SEBI.
Evasive
Medium priority
Employee cost trajectory going forward
Asked by Supratim Datta, Ambit Capital
Management refused to give any forward view on employee costs.
no guidanceforward-looking statement disclaimer
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Question
If I look at your employee costs, and I'm talking about the standalone business. If the employee costs have stabilized, literally the Q1, should we assume this to be the runway going forward as well?
Nehal Vora, Managing Director and CEO, CDSL
I think it'd be difficult. We don't give, it forward-looking statements. But the important thing is that, this is a specialized business. We need, really the specialized personnel. And as we embark on a growth journey, we will need to kind of earmark more and more people also.
Declined
Medium priority
Number of private companies falling under MCA Demat rule
Asked by Sanket Godha, Avendus Spark
Management explicitly declined to provide any estimate.
refused to estimateno number given
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Question
You probably are aware about the number of companies which are less than INR 4 crores paid-up capital or INR 40 crores turnover. But in a rough guess, how much that number would be, if you have any wild guess on that?
Nehal Vora, Managing Director and CEO, CDSL
So on the first part, I would not like to give any wild answers. I would like it to go through a proper working before I can reveal that. I'm not able to give any numbers on what are the numbers.
Answered
Medium priority
Pledge income and impairment cost for the quarter
Asked by Sanket Godha, Avendus Spark
Management provided specific numbers for pledge income and impairment cost.
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Question
First is on impairment cost, which has happened in the current quarter. Second is pledge income, and then third is annual issuer charges from unlisted entities.
Girish Amesara, CFO, CDSL
We received INR 4.19 crore income during the quarter. With respect to impairment... The value is INR 3.3 crore in this quarter.
Partial answer
Medium priority
Reason for 80% sequential growth in online charges vs 41% delivery volume growth
Asked by Ajox Frederick, Sundaram Mutual Fund
Management gave a tentative agreement but did not confirm or quantify IPO contribution.
no confirmationattributed to multiple factors
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Question
However, online charges are about 80% growth sequentially. So the gap, can I assume it to be IPO-driven?
Nehal Vora, Managing Director and CEO, CDSL
Yeah, you can possibly take that as your derivation, but we kind of... It's difficult to again predict that, whether it is only because of this factor or there are a multitude of factors which happen.
Answered
Medium priority
Market share of CDSL in KYC business
Asked by Santosh, Kesari Finance
Management provided a clear estimate of market share.
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Question
I just wanted to know that what is the market share of CDSL in the business itself?
Nehal Vora, Managing Director and CEO, CDSL
So figures are in population, but, our estimate is about 65%.
Quantitative claims vs filed numbers
| Claim | Management said | Filing | Verdict |
|---|---|---|---|
| e-CAS income Q2 FY24: INR 7 crore | ₹7 cr | ₹207 cr | Understated vs filing |
| e-Voting income Q2 FY24: INR 15 crore | ₹15 cr | ₹207 cr | Understated vs filing |
| Pledge income Q2 FY24: INR 4.19 crore | ₹4.19 cr | ₹207 cr | Understated vs filing |
Filed figures sourced from Screener.in. Claims within a small tolerance of the filing are marked “matches filing”.