NSDL IPO: GMP details and how it compares to CDSL

NSDL's upcoming IPO is scheduled to open on July 30, 2025, and close on August 1, 2025 with a price band set at ₹760-800 per share for its ₹4,011.6 crore IPO. The minimum amount of investment required by a retail is ₹13,680 (18 shares).

What makes this offering particularly interesting is that it's entirely an Offer for Sale (OFS), meaning existing shareholders are divesting their stakes to comply with SEBI's ownership regulations rather than the company raising fresh capital.

The major selling shareholders include IDBI Bank, NSE, Union Bank of India, SBI which picked up NSDL at ₹2 per share!, and HDFC Bank with some institutional investors set to realize astronomical returns of up to 39,900% on their original investments.

Grey Market Premium (GMP)

NSDL IPO GMP is ₹135, last updated Jul 28th 2025 08:57 AM. It's estimated listing price is ₹935 (cap price + today's GMP). The expected percentage gain per share is 16.88%.

The current price of NSDL in the unlisted space as on 28/7/2025 is ₹1,025

NSDL Segment breakdown

NSDL’s revenue mix is heavily skewed towards its payment banking arm, NPBL, which contributed over 50% of total operating revenue in FY25. However, despite being the top-line driver, NPBL operates with razor-thin profitability its PAT margin was just 0.26% in FY25, making it the least efficient segment. In contrast, the company’s core depository business, while accounting for a relatively lower 43.56% of revenue, remains the most lucrative. It clocked a PAT margin of 43.97%, showcasing its strong operational leverage and mature business model. Meanwhile, the database management segment (NDML), although the smallest contributor with just 5.75% of revenue, maintained respectable margins of 31.67%. This stark contrast in profitability highlights NSDL’s reliance on its core operations to offset the thin margins of its fast-growing, regulated payment bank.

The logical question to ask is why operate a segment that is squeezing your margins?

Despite razor-thin 0.2% margins, NSDL sticks with its payments bank because it’s a strategic client acquisition lever offering a bundled bank, demat, and trading account makes onboarding seamless for brokers and new investors. This builds long-term value as NSDL can cross-sell higher-margin products later, deepens its market infrastructure relevance, and aligns with regulatory pushes for digital inclusion. The payments bank may dilute short-term profits, but it’s NSDL’s play to lock in the next generation of market participants and boost ecosystem stickiness.

NSDL Vs CDSL

As of June 30, 2025, CDSL boasts a massive 15.86 crore demat accounts, nearly four times that of NSDL, which manages 4.04 crore accounts. But despite this lead in user base, CDSL’s total custody value stands at just ₹7.92 lakh crore, while NSDL commands a staggering ₹510.91 lakh crore in assets under custody more than 60 times higher.

This contrast highlights the fundamentally different business positioning of the two: CDSL is the dominant player in India’s retail demat space, catering to a wide base of first-time and low-ticket investors, with an average account value of around ₹5 lakh. Meanwhile, NSDL remains the preferred depository for institutional investors, mutual funds, and large corporates, where the average demat account holds roughly ₹1.25 crore in assets.

This stark contrast reflects two divergent strategic plays: NSDL is the bedrock of institutional, high-ticket capital flows, deeply integrated into the operations of mutual funds, insurers, large corporates, and unlisted securities issuance. CDSL, on the other hand, is aggressively capturing the retail mass market, riding India’s financial inclusion wave with a huge volume of modest-sized accounts

Financials Comparison

As per FY25 data, CDSL reported higher standalone revenue (₹8,482.09 mn) compared to NSDL (₹6,186.04 mn). However, when looking at core segment contribution, CDSL derived ~79% of its revenue from the depository business, while for NSDL, depository services contributed only ~43.56%. This reflects CDSL’s sharp focus on its core offering, while NSDL operates a more diversified model.

NSDL’s consolidated revenue was significantly higher at ₹14,201.46 mn, driven largely by its payment banking (NPBL) and database management (NDML) arms, which together contributed over 56% of its total operating revenue. This broader segmental base provides NSDL with a more balanced and scalable revenue profile, despite lower standalone figures.

Comparison of Standalone Results

Post-FY20, CDSL’s PAT margins surged sharply from 36.58% to 51.24% in FY21, peaking at 54.94% in FY22, while NSDL’s margins recovered more modestly, moving from 37.32% to a peak of 45.32% in FY21 before stabilizing around 44% by FY25. This gap reflects CDSL’s leaner, more focused business model, which benefits from lower operating costs and higher operating leverage due to its retail-heavy structure. In contrast, NSDL’s broader segment base including lower-margin businesses like payment banking and data storage dilutes its profitability, despite its significantly larger custody value.

How did CDSL's IPO fare?

When CDSL (Central Depository Services Limited) hit the markets with its IPO in June 2017, the response was nothing short of spectacular. The ₹524 crore offer was oversubscribed an astounding 170 times overall...including a massive 563× in the non-institutional category and nearly 24× among retail investors. Priced at ₹145 -149 per share, CDSL made its stock market debut on June 30, 2017, listing at ₹250, a rousing 68% premium over the issue price.

Road Ahead

Looking ahead, both companies are well-positioned to benefit from India's continued financial market expansion. NSDL's diversification into banking services provides additional growth avenues, while CDSL's dominance in retail accounts positions it perfectly for the ongoing democratization of investing in India. The competitive dynamics between these two depositories will likely intensify as they compete for market share in an expanding pie, ultimately benefiting the broader ecosystem of investors and market participants.

The upcoming NSDL IPO represents not just an investment opportunity, but a milestone in India's financial infrastructure development, offering investors a chance to participate in the backbone of the country's capital markets alongside the already-listed CDSL.

Research Assist: Krishna Priya (linkedin.com/in/krishna-priya-020a8a223)

Disclaimer: This content is for educational purposes only; please conduct your own research and consult with a qualified investment advisor before making any investment decisions.

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