CDSL, the Central Depository Services (India) Limited is coming up with IPO for which the market has been waiting. CDSL IPO review will look forward to the pros and cons of this issue.
About CDSL – Promoted by BSE, CDSL was incorporated in 1999. It is essentially a security depository service engaged in various forms of account opening, re-materialization and dematerialization of account, account processing, nomination, pledging, address change, security transmission and all other account related services. It also updates all account related activities through SMS and e-mail to the depository account participants. The company is a wholly owned subsidiary of BSE Limited though later it has divested its staked to leading banks as Sponsors.
Besides depository services, the company also engages itself with services like e-voting, keeping insurance in electronic form, e-locker and electronic exchange of information to the depository holder.
About the issue – CDSL IPO review finds the issue highlights as stated below.
Issue opens on – 19 June, 2017 (tentative)
Issue closes on – 21 June, 2017
Issue size – 35,167,208 equity shares of Rs. 10 face value each
Issue price – Rs 113 – Rs 115 price band
Lot size – 130 (tentative)
Listing exchange – NSE
Lead managers to this issue – SBI Markets, Axis Capital, Yes Securities, Edelweiss Financial Services, Nomura, Haitong Securities, IDBI Capital markets.
The issue break up is as follows.
Company financial report (consolidated) shows that CDSL has been making profit continuously. The PAT (profit after tax) data the company is in a continuous uptrend.
CDSL earns its revenue from keeping depository account and maintaining promised services. In addition it has a business model that evolves continuously and tries to be ahead in the ever evolving digital world. As the initial expenditure is very low comparing to others, it has high growth potential.
As per the red herring prospectus (DRHP) submitted by CDSL to Sebi in December, 2016, The net offer constitutes 32.98% of CDSL’s paid up post offer capital. BSE holds 50.o5% stake in CDSL. The promoters of CDSL, BSE, SBI, Bank of Baroda and the Calcutta Stock Exchange will be selling their stakes in CDSL through the IPO.
Keeping in view the way investors welcomed the BSE listing earlier this month which got around 35% oversubscribed, CDSL might also find buying spree among investors in IPO. The CDSL IPO review finds this IPO a good vehicle for investment.