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NSDL vs CDSL Analysis

Aug 1, 2025

Overview

With the announcement of NSDL's IPO, a comparison was made with CDSL, analyzing the business models, growth, market share, and valuation of both companies. The main focus was on the growth and financials of NSDL's payments bank and depository business.

NSDL vs CDSL: Business Model

  • NSDL and CDSL appear to be competitors, but their business models are different.
  • 80% of CDSL's revenue comes from depository services, while NSDL's is only 43%.
  • 51% of NSDL's revenue comes from banking services (mainly NSDL Payments Bank).
  • CDSL does not earn any revenue from banking services.

NSDL Financials and Growth

  • NSDL's revenue grew from 32.6 billion in 2020 to 142 billion in 2025, a 34% CAGR.
  • In 2025, NSDL Payments Bank's revenue was 7.22 billion, but profit was only 20 million.
  • NSDL's total net profit was 34.3 billion, with a small contribution from the payments bank.

Market Share and Demat Account Growth

  • In 2011, CDSL's market share was 40%, now close to 80%; NSDL's dropped from 60% to 20%.
  • CDSL gained rapid growth due to discount brokers and online EKYC.
  • In 2024, 88% of new demat accounts opened were with CDSL.
  • NSDL's demat account growth in the last 5 years has been 17% CAGR.

Valuation and Market Cap

  • The company's market cap is around 160 billion and the P/E ratio is 46.
  • The grey market premium at the time of recording was around 18%.
  • Revenue growth has slowed to 12% in the past year.

Future Challenges and Opportunities

  • Slowdown in demat account growth and brokers leaning towards CDSL.
  • For future growth, NSDL needs to perform better in the payments bank business.
  • Payments bank business growth also slowed last year.

Conclusion

  • NSDL should focus more on the payments bank business for growth.

Action Items

  • TBD тАУ NSDL Management: Develop strategies to attract large brokers.
  • TBD тАУ NSDL Payments Bank Team: Take measures to increase growth and profitability of the payments bank business.

Questions / Follow-ups

  • Will there be any changes in the grey market premium or subscription at the time of the IPO?
  • What new services will NSDL Payments Bank launch in the future?

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