NSDL IPO 2025: A Deep Dive into India’s Largest Depository Going Public

The National Securities Depository Limited (NSDL) is gearing up to launch one of the most anticipated Initial Public Offerings (IPOs) of 2025, offering investors a rare chance to own a stake in India’s financial market backbone. As the country’s first and largest securities depository, NSDL plays a pivotal role in facilitating every securities transaction in India’s capital markets. With its IPO set to open on July 30, 2025, here’s everything you need to know about this landmark offering, from key details to investment potential and risks.

IPO Snapshot: Key Details

• IPO Dates: Opens July 30, 2025, closes August 1, 2025
• Listing Date: August 6, 2025 on BSE and NSE
• Price Band: ₹760–₹800 per share
• Lot Size: 18 shares (minimum investment: ₹14,400 for retail investors)
• Issue Size: ₹4,011.6 crores (100% Offer for Sale, OFS)
• Selling Shareholders: IDBI Bank (2.22 crore shares), National Stock Exchange (1.8 crore shares), State Bank of India, Union Bank of India, HDFC Bank, and SUUTI
• Allocation: 50% for Qualified Institutional Buyers (QIBs), 15% for Non-Institutional Investors (NIIs), 35% for Retail Investors, with 85,000 shares reserved for employees at a ₹76 discount
• Lead Managers: ICICI Securities, Axis Capital, HSBC Securities, IDBI Capital, Motilal Oswal, SBI Capital Markets
• Registrar: MUFG Intime India Private Limited (Link Intime)

The IPO is entirely an OFS, meaning NSDL won’t receive any proceeds—funds go to selling shareholders. This divestment aligns with SEBI’s mandate that no single entity can hold over 15% in a Market Infrastructure Institution (MII), as IDBI Bank (26.1%) and NSE (24%) currently exceed this limit.

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What Does NSDL Do?

Founded in 1996 under the Depositories Act, NSDL pioneered dematerialization in India, converting paper-based securities into electronic form. As a SEBI-registered MII, it’s the backbone of India’s securities market, handling everything from trade settlement to corporate actions. As of March 31, 2025, NSDL manages:

• 39.45 million active demat accounts
• ₹464 lakh crores in assets under custody
• 79,773 issuers across 186 countries
• A network of 65,391 depository participant service centers

NSDL operates through three key segments:

1. Core Depository Services (43.6% of revenue): Dematerialization, trade settlement, custody, and corporate actions like dividends. NSDL holds an 80%+ market share in custody value.
2. NSDL Payments Bank Limited (NPBL, 50.7% of revenue): Digital banking, cash management, and payment services, primarily B2B2C.
3. NSDL Database Management Limited (NDML, 5.7% of revenue): e-KYC, Central KYC Registry, and tech-driven services for 1,728+ SEBI-registered intermediaries.

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Financial Performance: Strong and Steady

NSDL’s financials reflect its robust market position and consistent growth:

• Revenue from Operations: Grew from ₹1,022 crores (FY23) to ₹1,420 crores (FY25), a 17.9% CAGR.
• Profit After Tax (PAT): Rose from ₹235 crores to ₹343 crores, a 20.8% CAGR.
• FY25 Highlights:
  • Total Income: ₹1,535 crores (+12.4% YoY)
  • EBITDA: ₹491 crores (34.5% margin)
  • PAT Margin: 24.2% (up from 21.7% in FY24)
  • Return on Equity (RoE): 17.1%
  • Earnings Per Share (EPS): ₹17.16
• Debt-Free Balance Sheet: Strong cash flows and consistent dividends (₹2 per share proposed for FY25).

NSDL’s 60% recurring revenue from custody fees and fixed DP charges provides stability, cushioning it against market volatility.

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NSDL vs. CDSL: A Duopoly Breakdown

India’s depository market is a duopoly between NSDL and CDSL, each with distinct strengths:

Metric	NSDL (FY25)	CDSL (FY25)
Total Income	₹1,535 crores	₹1,199 crores
Net Profit	₹343 crores	₹526 crores
Demat Accounts	4.0 crores	15.86 crores
Assets Under Custody	₹464 lakh crores	₹79 lakh crores
Market Focus	Institutional & Corporate	Retail Investors
P/E Multiple	46.6x	70.0x

• NSDL leads in institutional custody, handling 100% of foreign portfolio investor securities and dominating debt instruments.
• CDSL excels in retail demat accounts, partnering with discount brokers like Zerodha and Groww.
• Valuation: NSDL’s 46.6x P/E is more attractive than CDSL’s 70x, offering a 22% discount from its unlisted market peak of ₹1,025.

Why Invest in NSDL IPO?

Strengths

1. Market Leadership: NSDL’s duopoly status and high entry barriers (regulatory and technological) ensure a strong moat. It’s India’s largest depository by issuers, instruments, and custody value.
2. Diversified Revenue: Spanning depository (43.6%), banking (50.7%), and tech services (5.7%), NSDL is less reliant on market cycles than pure depositories.
3. Stable Income: Over 60% of revenue is recurring, providing predictability.
4. Growth Drivers: Rising retail investor participation, increasing demat penetration, and new asset classes (e.g., insurance policies, digital certificates) fuel long-term growth.
5. Financial Health: Debt-free, high margins, and strong RoE make NSDL a financially sound investment.

Opportunities

• Capital Market Expansion: India’s demat accounts grew at a 21.94% CAGR (FY14–FY25), reaching 192.4 million by March 2025.
• Tech Innovation: Initiatives like T+0 settlement, blockchain-based debt platforms, and the YUVA Plan (zero settlement fees for under-24s) position NSDL for future growth.
• Global Reach: Serving 186 countries, NSDL can tap international investor demand.

Risks to Watch

1. Regulatory Scrutiny: SEBI issued warnings for compliance lapses, including IPO allotment transparency and cybersecurity. NSDL settled a case for ₹3.12 crore in October 2024.
2. Market Dependence: Revenue ties to trading volumes, making NSDL vulnerable to market downturns.
3. CDSL Competition: CDSL’s faster retail growth (34.4% CAGR vs. NSDL’s 18.4% over FY20–24) could erode market share.
4. Cybersecurity Threats: As critical infrastructure, NSDL faces risks from IT outages or cyberattacks, requiring constant tech investment.
5. Pure OFS Structure: No fresh capital limits growth funding, with proceeds going to selling shareholders.

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Valuation: Is It Worth It?

At ₹800 (upper band), NSDL’s 46.6x P/E is below CDSL’s 70x and the industry average of 68x, suggesting a fair valuation for a market leader. Its 22% discount from unlisted market highs (₹1,025) adds appeal. The Grey Market Premium (GMP) is reportedly ₹145, indicating potential listing gains of 18–20%.

Management and Governance

NSDL operates without promoters, led by a professional team:

• Padmaja Chunduru (MD & CEO): 37+ years in banking
• Parveen Kumar Gupta (Chairman): 39+ years in banking
• Madhu Sudan Sahoo: 40+ years in financial regulation

This experienced leadership, coupled with institutional shareholders like IDBI Bank and NSE, enhances credibility.

Should You Apply?

The NSDL IPO is a compelling long-term bet on India’s financial infrastructure. Its market dominance, diversified revenue, and attractive valuation make it a solid pick for investors with a 3–5-year horizon. However, regulatory risks, market dependence, and the OFS structure warrant caution.

Recommendation: APPLY for long-term wealth creation. Retail investors can leverage the 35% quota, while employees benefit from the ₹76 discount. To boost allotment chances, apply through multiple demat accounts, bid at the cut-off price, and subscribe early.

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How to Apply

1. Log into your bank or broker account (e.g., Zerodha, 5paisa, IPO Ji).
2. Select NSDL IPO in the IPO section.
3. Enter lot quantity (minimum 1 lot = 18 shares) and price (₹760–₹800 or cut-off).
4. Use UPI or ASBA for payment.
5. Check allotment status on August 4, 2025, via Link Intime’s website.

Final Thoughts

NSDL IPO is a unique opportunity to invest in India’s financial market infrastructure at a time when capital markets are booming. With strong fundamentals, a stable revenue model, and growth potential, it’s well-positioned for long-term gains. That said, keep an eye on regulatory compliance and market risks. Start preparing your application, and consult a financial advisor to align this with your portfolio goals. Here’s to a smart investment in India’s financial future!

FAQs (Frequently Asked Questions)

1. What is the NSDL IPO price band?
   ₹760–₹800 per share, with a lot size of 18 shares (₹14,400 minimum).
2. When does the NSDL IPO open and list?
   Opens July 30, 2025, closes August 1, 2025, and lists on August 6, 2025.
3. Is NSDL a good investment?
   Yes, for long-term investors, due to its market leadership, stable revenue, and fair valuation, but regulatory risks exist.
4. How does NSDL compare to CDSL?
   NSDL leads in institutional custody and assets under custody, while CDSL dominates retail demat accounts.
5. Why is the NSDL IPO an OFS?
   It’s driven by SEBI’s rule limiting single-entity stakes to 15%, with shareholders like IDBI Bank and NSE divesting.

Disclaimer: This article is for informational purposes only and does not constitute financial advice. Always consult with a professional advisor before investing.