CDSL Share Price Performance

CDSL Share Price in 2017:

The Company CDSL was listed on NSE on 30th June 2017.  The highest price was Rs.486 as achieved on 14th of July 2017 from eleven trading sessions. After that, there was a correction of 195 points in the next twenty trading sessions, and the lowest was at 291.1 on 11th Aug 2017.

There was a retracement rally and failed attempt of CDSL share price to cross Rs. 400 price mark on September 20 and October 18, 2017, and it touched 398.4 and 396.6 respectively. The price Rs. 417 is the 66% retracement of the last fall, but it could not cross the psychological figure of Rs. 400.

CDSL Share Price Trend in 2018:

For the quarter ended on 30-06-2018, the company has recorded a consolidated sales of Rs 45.29 Cr, down -12.54 % from the previous quarter sales of Rs 51.78 Crore and up 11.69 % from last year same quarter Sales of Rs 40.55 Cr company has reported a net profit after tax of Rs 22.03 Cr in the current quarter.

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Overview of CDSL India Ltd:

The company was founded in Mumbai on December 12, 1997, as 'Central Depository Services Limited,' a public limited company which was incorporated under the Companies Act, 1956. The company acquired its certificate of business commencement from the Ministry of Corporate Affairs on 19th December 1997. The company was registered initially by the certificate of registration on August 19, 1998, through SEBI under the depositories regulations and eventually attained its certificate of business commencement as a depository on February 8, 1999.

A depository facilitates the holding of securities in the electronic form and enables the transactions of securities to be processed by book entry. The Depository Participant (DP), as an agent of the depository, provides depository services to investors. According to the guidelines of SEBI, the financial institutions, banks, custodians, and stockbrokers are eligible to act as DPs. The investor who is known as the beneficial owner (BO) need to open a demat account through any DP for the dematerialization of the holdings and the transferring securities.

The balances in the account of investors are recorded and maintained with CDSL and can be obtained through the DP. The Depository Participant is required to provide a statement of account to the investor who gives the information of securities holdings and transactions. The depository system has effectively removed paper-based certificates which were prone to be fake, forged, and counterfeit resulting in bad deliveries. The CDSL provides an efficient and expeditious transfer of securities.

The CDSL was initially promoted by BSE Ltd which has after that divested its stake to some prominent banks as "Sponsors" of CDSL.

The CDSL was set up with the objective of providing convenient, dependable and secure depository services at affordable cost to all the participants of the market. Some of the important milestones achieved by CDSL system are:

The CDSL received the certificate of business commencement from SEBI in February 1999, the honorable Union Finance Minister, Shri Yashwant Sinha inaugurated the operations of CDSL on 15th July 1999.

The trades settlement in the demat mode through BOI Shareholding Limited and the clearinghouse of BSE Ltd started in July 1999.

All leading stock exchanges like the BSE Ltd, NSE and Metropolitan Stock Exchange of India have established connectivity with CDSL.

CDSL Share Price Band:

The IPO of up to 35,167,208 equity shares of face value of 10 each (“equity shares”) of CDSL (“Company” or “Issuer” Or “CDSL”) for cash at a price of` per equity share.

Price Band is from ` 145 to ` 149 per Equity Share of face value of ` 10.00 each.

The reason of CDSL Share Price Surge in 2017:

The revenue growth and PAT of the company had been constant at 12% over the last four years; Return on Equity has been around 17% over the previous six years. The expected CAGR was 15 to 18% from the stock on a three-year horizon with markedly low volatility.

Given all the above factors, the IPO was oversubscribed by 170 times (23 times alone in retail category)

The growth of CDSL share price was a combination of three reasons:

  1. The long-term promise this stock has given because of the reasons mentioned above;
  2. Firm purchases were made from the individuals and institutional buyers who missed buying at the IPO;
  3. Due to the bull market.