CDSL - Stock for our children

(mylu) #23

Q2’2019 results.

Income up by 26% Q-O-Q.
Expenses nearly same Q-O-Q
Net profit up 36% Q-O-Q

(Abhishek Basumallick) #24

Q2 Concall summary (source: capital market)

  • The company has posted 11% growth in the operating income to Rs 62.89 crore, while the net profit moved up 12% to Rs 30.15 crore in Q2FY2019. The other income has increased by 7% to Rs 9.74 crore.

  • Among the key revenue segments, the annual issuance charges have increased 18% yoy to Rs 16 crore in Q2FY2019, transaction charges 3% to Rs 10.26 crore, online data charges 54% to Rs 10.17 crore and e-voting charges 19% to Rs 3.21 crore, while IPO corporate action charges declined 27% to Rs 6.16 crore.

  • The company has continued to gain market share with incremental demat account share was higher at 64% in Q2FY2019 and 47.57% at aggregate level end September 2018 up from 47% end June 2018. The aggregate demat accounts with the company increased to 1.60 crore end September 2018 from 1.54 crore end June 2018.

  • The company has added a new revenue segment called VDR (Virtual Data RoM), where companies listing through IPO stores data to be used by merchant bankers, auditors etc. This segment has made revenue of Rs 3-4 lakh, while its expected to increase once more IPOs enter the market. There were no big expenses for setting up this service.

  • NAD which provides services for online document storage has tied-up with 460+ universities.

  • MCX Menthol settlement has been facilitated through CCRL in October 2018, while the company expects to facilitate non-agriculture and non-metal commodities clearing and settlement in Q3FY2019.

  • The employee base of the company, on consolidated basis, has increased to 238 end September 2018 from 226 end June 2018 and most were recruited by CCRL.

  • After Supreme Court verdict restricting use of Aadhar Card for E-KYC verification, the company is planning to go for verification through QR code, which does not require additional expenses.

  • As per a new regulation, the MD of a depository and market infrastructure cannot serve as an MD for more than two terms of 5 year each. The MD of the company is completing his two terms of service as MD and he may not continue in service after 31 March 2019.

  • Out of 64000 unlisted materialized public sector companies 200 companies are in the pipeline of CDSL so far for the dematerialization of shares.

  • The market share in KYC stands at 60% in Q2FY2019 and the company has 1.7 crore KYC records with itself.

  • The capex of the company stands at Rs 5-6 crore for FY2019.

(Dhiraj Dave) #25

MCX decision to settle the contrac through CCRL is very good milestone in the CDSL lifecycle. I consider MCX being a mature player in exchanges and they would evaluated quality/technology/realiablity and not only cost while taking decision. When CDSL gained this business, it is major competitive lead CDSL has taken in my opinion. I am not aware about MCX working with other clearing corporation as well and if any member can provide insight on same, it would improve my knowledge for sure.

Secondly, managing higher incremental share in demat account also working well for CDSL. Like the development in the company.

Disclosure: I am invested in BSE due to superior Dividend yield offered at current price, which has around 24% equity interest in CDSL and hence my view may be biased. Investor shall do his/her own due diligence before making any investment decision.

(hamed) #26

Another reason for MCX to settle with CDSL could be because they recently bought stake in CDSL. So they are giving business to sister concern.

(SMondal15) #27

Q2 concall clarified the new rule that SEBI has bring into , floating a depository will require 100 cr as capital and corporate house can hold maximum of15% stake.I think this will soothe investor concern on CDSL will face increasing competion on its core depository business. Some competion will always be there in form of Kyc business from Link-intime and all.

(mylu) #28

Q2 Conf call details.

(mylu) #29

(Vinay Taparia) #30

looking at the price and volume pattern,It seems that smart money is buying CDSL at lower levels

(anshul jain) #31

They may be selling also. Can you please share the logic for it.

(Vinay Taparia) #32

First major up move in recent days came on 19th Dec 18 with Voulme of 37 Lacs shares. CDSL has not yet broken the low of that day. After that day, the stock fell with less volume and moved up with higher volume. This is coupled with positive divergence in RSI. I think major up move will come after 238.90 which is the high of 20th Dec 2018.
One should wait for confirmation before taking any buy decision. The stock should close above 233 (50 DEMA) level for at least a week because a lot of people have stuck in this stock at every higher level. They may want to get out at every rise. Sustaining above 50 DEMA and breaking above 239 level will give confirmation of sustained buying