Tue Jan 28 16:52:05 IST 2025: **CDSL Stock Plunges After Disappointing Quarterly Results**

MUMBAI, January 29 – Shares of Central Depository Services (India) Ltd. (CDSL) plummeted 6.41% on Tuesday, extending a two-day losing streak following the release of its December quarter earnings. The stock has now fallen over 16% in the last three trading sessions.

While CDSL reported a 21.5% year-on-year increase in consolidated net profit after tax (PAT) to ₹130 crore, revenue declined by 14% due to lower transaction charges, online data charges, and other income. Standalone net profit, while up 22.09% year-on-year at ₹105 crore, saw a significant 38.60% quarter-on-quarter drop. This was attributed to increased employee and technology expenses, a shrinking margin (down 424 basis points to 57.8%), and a near halving of other income.

Further contributing to the decline was a drop in new net accounts opened during the quarter (92 lakh compared to 1.18 crore in the previous quarter) and a fall in transaction charges income (₹59 crore from ₹83 crore).

Brokerage firms have reacted cautiously. Motilal Oswal Financial Services noted that CDSL’s investments in human resources and technology may limit immediate operating leverage benefits, though they predict margin improvement in the coming years. Nuvama lowered its price target for CDSL to ₹1,510 from ₹1,740, citing slow secondary market volumes and potential primary market slowdown, while maintaining a “hold” rating. Analyst sentiment is currently mixed, with a split between buy, hold, and sell recommendations.

Read More