Business Model of NSDL (National Securities Depository Limited)
1. Core Business Segments:
- Depository Services (Main revenue contributor, ~37–48% of total revenue)
- Subsidiaries:
- NDML (NSDL Database Management Ltd.) – E-governance and digital services (e.g., insurance repository, KYC, eVoting, Tax Info)
- NPBL (NSDL Payments Bank Ltd.) – AePS, micro-ATMs, and digital banking
2. Revenue Streams:
- Transaction Fees: Based on trading volume (approx. 24–33% of operational revenue)
- Account Maintenance Fees
- Service Fees from value-added services (IDeAS, eVoting, digital lending support)
- Subsidiary Contributions:
- NPBL: 51.24% of total revenue (9M FY24)
- NDML: 5.97% of total revenue (9M FY24)
3. Technology Investments:
- High dependency on IT systems and infrastructure
- Significant spend on maintenance, upgrades, cybersecurity
💰 IPO Structure
Type: Offer for Sale (OFS)
Total Shares Offered: Up to 50,145,001 Equity Shares
Face Value: ₹2 per share
Price Band: [Not yet disclosed in the PDF]
Selling Shareholders:
| Shareholder | No. of Shares Offered |
|---|---|
| IDBI Bank Ltd. | 22,220,000 |
| NSE (National Stock Exchange) | 18,000,001 |
| Union Bank of India | 500,000 |
| State Bank of India | 4,000,000 |
| HDFC Bank | 2,010,000 |
| Administrator of Specified UTI Trust | 3,415,000 |
Employee Reservation:
- [●]% of post-offer capital reserved for eligible employees
- Discount for employees possible (up to [●]% of Offer Price)
📊 Key Financial Insights (Extracted from FY2022–FY2024 & 9M FY2023–24):
| Metric | FY2022 | FY2023 | FY2024 | 9M FY24 | 9M FY23 |
|---|---|---|---|---|---|
| Total Revenue (₹ mn) | 7,611.10 | 10,219.29 | 12,682.44 | 10,565.46 | 9,341.96 |
| Revenue from Depository Svcs | 3,692.62 | 4,091.46 | 4,730.34 | 4,520.62 | 3,469.60 |
| Depository Revenue % | 48.52% | 40.03% | 37.30% | 42.79% | 37.14% |
| Transaction Fees (₹ mn) | 2,535.71 | 2,553.82 | 3,086.34 | 3,155.26 | 2,248.50 |
| Depository Accounts (millions) | 26.68 | 31.46 | 35.77 | 38.77 | 34.58 |
📦 Allotment Insights
- Anchor Investors: May be allocated shares 1 day before IPO opens.
- QIBs (Qualified Institutional Buyers): May have an early close, 1 day before retail.
- Retail and Employees: Separate quotas defined.
- Employee Discount: Offered, percentage not disclosed yet.
- Registrar: MUFG Intime India (formerly Link Intime)
IPO Revenue & Allocation Strategy
Since it is a pure Offer for Sale (OFS):
- No fresh capital will be raised by the company
- Proceeds go to selling shareholders, not NSDL
- Hence, the company is not directly using IPO money for expansion or operations
🧠 Understanding This IPO Strategically
- Why NSDL is Going Public?
To provide an exit to current institutional shareholders (banks & exchanges), and possibly increase public participation in a core market infrastructure entity. - How NSDL Makes Money?
Through transaction-based fees, account-related fees, value-added digital services, and its subsidiaries (NDML & NPBL). - Risk Factors to Watch:
- High dependency on market trading activity
- Tech failures (system glitches noted multiple times)
- Regulatory risks from SEBI, RBI, IRDAI