Capitaline

Analyst Meet / AGM 30-Jan-20

Conference Call

Central Depository Services

Crosses 2 crore beneficial owner account base in January 2020

Central Depository Services conducted a conference call on 29 January 2020 to discuss the financial results of the company for quarter ended December 2019. Nehal Vora, MD & CEO of the company addressed the call:
Highlights:

The number of active Beneficial Owners accounts with CDSL has increased from 1.67 crore end December 2018 to 1.97 crore as on December 2019, which indicates growth of 17.96%. the company has become the first company to cross the number of beneficial owners account of 2 crore in January 2020.
The company has 600 Depository Participants offering Depository Participants services from over 19,000 locations across the country. These Depository Participants comprise of Clearing Members, Banks, Custodians & Non-Banking Financial Companies.
The securities of almost all listed companies have been admitted with CDSL for demat. Further, a large number of private limited and unlisted companies are also admitted with CDSL. The securities of 14,709 companies have been admitted for demat with CDSL end December 2019. About 200-250 unlisted companies are added every month, 588 companies were added in Q3FY2020 and 1694 companies in 9MFY2020. Processing fees from these companies stood at Rs 1.4 crore in Q3FY2020 and Rs 4.62 crore in 9MFY2020.
During the last 12 months, the volume of securities under custody has increased by 28.27% and the value of securities has increased by 7.30%.
The company has set up a branch at GIFT City becoming the first and only depository to have received the approval from SEBI to commence operations at GIFT City. The Branch will contribute to the development of the market with the introduction of delivery-based trading to the existing suite of the products traded on the exchanges at the IFSC Center. It would also enable issuers to list their issuances like bonds & depository receipts thereby enhancing the value proposition for the IFSC Center.
SEBI prescribed webcast of Annual General Meeting (AGM) will be compulsory for top 100 listed companies by market capitalization from 2018-19. CDSL has introduced the live webcast facility which would enable shareholders gain access to the live proceedings at the AGM of companies through their secure e-voting login credentials. About 4500 companies have used e-voting platform of the company
The company has witnessed dip in the profit in Q3FY2020 due to non-recurring items.
CDSL Ventures has recorded 21% growth in new KYC generations to 7.5 lakh from 4.88 lakh and KYC fetches have increased 33% to 24.48 lakh in Q3FY2020 from 18.36 lakh in Q3FY2019.
The company has so far onboarded 590 universities in National Academics Depository of which 261 are live, while updated about 2.5 crore records. The company has also appointed 8.5 lakh students.
As per the company, the pricing in National Academics Depository depends on charges per record uploaded by the universities and verification of records by verifier. The charges will be decided by the MHRD, which has appointed the committee to finalize the charges. The company has registered 150 verifiers, while verification volumes insignificants.
Bad debt provisions stood at Rs 8 crore in 9MFY2020 compared Rs 6 crore in FY2019.
The revenue breakup for 9MFY2020 - annual issuer income 35%, transaction charges 18%, IPO corporate action charges 9-10%, KYC online data charge 15%, Sebi project 6% and other 13%.
Tax rate would be 25% ahead.
Insurance depository: IRDAI has not made it mandatory for dematerialization of policies, while insurers are keen to switch to electronic policies.
SEBI project has contributed revenue Rs 9.4 crore, while expenses were Rs 6.3 crore in this project. One slab of projected completed. The call on phase 2 of the SEBI project will be taken by SEBI.

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