Holding Down Profits: How CDSL Gave 529% Returns in Less Than 3 Years
If you had invested ₹1 lakh in CDSL in January 2020, you could have had ₹6.2 lakhs today! This multibagger gave its investors 529% returns in less than three years. Here’s a closer look at the company.
🏦 Stock: Central Depository Services Ltd.
🏦 NSE: $CDSL
💡 About the Company
Founded in 1999, CDSL is a market infrastructure institution which is a crucial part of the capital market structure.
It provides its services to:
📄 Market participants
📄 Clearing corporations
📄 Depository participants
They aim to fulfil one goal, which is to be ‘convenient, dependable and secured depository services’ (a depository is a facilitator for holding securities in the dematerialised form and an enabler for securities transactions).
The company facilitates holding and transacting securities in electronic form and facilitates the settlement of trades executed on stock exchanges.
These securities include equities, debentures, bonds, mutual funds, certificates of deposit (CDs), commercial papers (CPs), Treasury Bills (TBills) and more.
Its facilities include e-Locker, M-Voting, e-Voting and Myeasi Mobile App.
💸 Business Segments
◾ Depository: Dematerialisation, rematerialisation, holding, transfer and pledge of securities in electronic form and e-voting services.
◾ Data Entry and Storage: Centralised record keeping of KYC documents for capital market investors.
◾ Repository: Provide facilities for policyholders’ receipts to keep insurance policies in electronic form and to undertake changes and more.
Being India’s largest securities depository, they became the first depository with more than 3 crore Demat accounts. Its focus is on eliminating all paper-based processes and workflows to become a fully digital organisation and offer a single Demat account to its Demat account holders, which will hold all financial assets across regulators, subject to all regulatory approvals based on the announcements made by the Finance Minister in the Union Budget.
On January 1, 2020, the shares of the company were trading at ₹221.80, while they were priced at ₹1,396.85 as of September 12, 2022.