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CDSL IPO looks an attractive issue; HEM Securities recommend to 'Subscribe' - IndiaNotes.com
CDSL IPO looks an attractive issue; HEM Securities recommend to 'Subscribe'
Hem Securities | Published: 19 Jun, 2017  | Source : IndiaNotes.com

 

Co is the leading securities depository in India by incremental growth of Beneficial Owner (“BO”) accounts over the last three Fiscals and by the total number of registered Depository Partic-ipants (“DPs”), as at the end of Fiscal 2016, according to the CRISIL Report. However, in terms of market share, co is the second largest depository in India.As of April 30, 2017, co had over 12.4 million investor accounts. In Fiscal 2017, co held a 59% market share of incremental BO accounts with a net growth in BO accounts of 13.68% from Fiscal 2016 to Fiscal 2017.Over 253 billion securities of 9,934 issuers under co’s custody representing a total value of Rs 18.3 trillion. 589 regis-tered DPs who had over 17,000 service centres across India. Over 15 million KYC records with a market share of approxi-mately 67%. Co’s revenue from operations includes transaction charges, account maintenance charges and settlement charges paid by DPs and annual fees, corporate action charges and e-voting charges paid by companies whose securities are admit-ted to cdsl’s systems. Co was initially promoted by the BSE which subsequently divested a part of its stake to leading Indi-an banks. Co have connectivity with clearing corporations of all the leading Indian stock exchanges including the BSE, National Stock Exchange (“NSE”) and Metropolitan Stock Exchange of India. Co have also entered into MoUs with depositories global-ly including with DTCC, JASDEC and Euroclear. Co is bringing offer for sale of upto 35,167,208 Eq Shares.


Reasons to "Subscribe"


Co have a wide network of DPs, who act as points of service for co’s investors, operating from over 17,000 sites across the country, offering convenience for an investor to select a DP based on its cost structure and locational convenience to engage its services. As of April 30, 2017 co had 589 DPs servicing across 29 states and 7 union territories including two overseas centres. The number of service centres grew at 21.35% from 11,877 in Fiscal 2015 to 17,489 in Fiscal 2017. Co’s BO accounts grew at a CAGR of 12.98% from 9,610,002 in Fiscal 2015 to 12,267,432 in Fiscal 2017. As of April 30, 2017, co held over 15 million capital market investor records under the KRA representing approximately 67% market share. As of April 30, 2017, co had opened approximately 325,000 e-Insurance accounts, holding more than 66,000 insurance policies in electronic form.


Valuation


At price band of Rs 145-149 ,co is bringing the issue at p/e multi-ple of around 18 on FY17 Eps. Co with its sound fundamentals looks attractive issue. Hence we recommend "Subscribe" on issue .


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About Hem Securities
The Hem Securities is one of the leading broking Network in India. It provides trading platform in all the leading exchanges namely - BSE, NSE, MCX , NCDEX & MCX-SX. Their mission is to build wealth for their investors by offering them best financial services through trading & investment strategies and honoring commitment with ethical & transparent business practices.

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Disclaimer: The author has taken due care and caution to compile and analyse the data. The opinions expressed above are only the views of the author, and not a recommendation to buy or sell. Neither the author nor IndiaNotes.com accept any liability whatsoever arising from the use of any of the above contents.