NSDL shares edge higher ahead of first Q1 results since market debut

At present, NSDL trades at a price-to-earnings multiple of about 79, compared to CDSL’s roughly 66.

Shares of National Securities Depository Ltd. (NSDL) swung sharply on Tuesday, August 12 — rising up to 5 percent in early trade before paring almost all gains — as investors awaited the depository’s first quarterly results since its market debut, amid a broader decline in Indian equities.

The stock had a volatile start to the week. On Monday, it briefly touched an intraday high of Rs 1,425, nearly 80 percent above its IPO price of Rs 800, before giving up gains and ending the session over 12 percent lower from the day’s peak.

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Rival Central Depository Services (India) Ltd. (CDSL) recently reported a 15.3 percent sequential rise in revenue and an improvement in margins for the June quarter. However, the number of new demat accounts opened during the period dropped 11 percent both sequentially and year-on-year, even as demat custody value grew compared to the previous quarter.

Since listing, NSDL shares have rallied sharply, pushing valuations above those of CDSL — a reversal from the discount they traded at prior to debut. The company entered the market on August 6 at Rs 880 on the BSE, a 10 percent premium to its issue price. The debut premium was lower than grey market expectations, though analysts have largely maintained a long-term bullish view on the stock, citing NSDL’s dominant position in the depository business.

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At present, NSDL trades at a price-to-earnings multiple of about 79, compared to CDSL’s roughly 66.

By around 11 am, NSDL shares were trading at Rs 1,290 on the NSE, up 1.4 percent from the previous close, with about 1 crore shares changing hands — sharply lower than the 5 crore shares traded yesterday.

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