Mutual Funds Commodities Research Tax Planning IPO Our Team Contact Us  
Google
Web www.equitybulls.com
Research

| More

Maintain BUY on CDSL - Firing on all cylinders - HDFC Securities

Posted On: 2020-10-28 09:18:48


Mr. Amit Chandra, Institutional Research Analyst, HDFC Securities

CDSL delivered a robust performance, driven by traction in transaction charges (34% of revenue, +48.2% QoQ). The transaction charges surged due to high retail activity, an increase in delivery volume, and strong addition of new accounts (+35% YoY). Increase in pledge activity due to change in regulations will further boost transaction revenue in 2H. Online data charges (+32% QoQ) revived, led by a strong increase in KRA records (+26% YoY). The pandemic has led to increased demand for Digital services (virtual AGMs, e-voting, Aadhaar based e-KYC, etc.) and CDSL is the prime beneficiary. CDSL continued to gain BO account market share from NSDL (stood at 56.1% in Sep-20 vs. 51.8% in FY20). Its incremental market share stood at 87% due to exclusive arrangements with discount brokers. BO accounts are the building blocks for a depository and have a high correlation to revenue growth. Margin expanded 264bps QoQ to 60.9% and was in line with expectation. We increase the FY22/23E EPS estimate by +9.1/+8.2% due to a surge in transaction revenue. We value CDSL on SoTP basis by assigning 30x to Sep-22E core profit and adding net cash to arrive at a target price of Rs 565. The stock trades at a P/E of 25.6/23.4x FY21/22E EPS. Maintain BUY.

2QFY21 highlights: CDSL revenue was up 36.7/69.4% QoQ/YoY to Rs 0.89bn, higher than our estimate of Rs 0.72bn. Annual Issuer/Transaction/IPO/KYC revenue was up 3.9/48.6/54.2/32.0% QoQ. Net cash stood at Rs 8.1bn (16% of Mcap) and cash conversion (FCF/PAT at 98%) improved. Technology cost was up 42.3% QoQ due investment in IT infrastructure and other expenses increased 43.3% QoQ, driven by higher provisions (+243% QoQ). Investments in technology will continue, and further margin expansion will be a function of growth; we have assumed EBITDA margin of 59.4/60.1/60.7% in FY21/22/23E.


Source: Equity Bulls

Click here to send ur comments or to feedback@equitybulls.com


Disclaimer:The article above is a gist / extract of the original report prepared by the research firm / brokerage firm. This article is not to be considered as an offer to sell or a solicitation to buy any securities. This article is meant for general information only. www.equitybulls.com, its employees or owners or the research firms, its employees or owners won't be responsible for any liability that may arise from information, errors or omissions in these articles. www.equitybulls.com or its employees or owners / the research firms or its employees or clients or owners may from time to time hold positions in securities referred in this article. For detailed research reports, please contact the concerned research firm directly.





Other Headlines:

Auto Sector - Monthly Volume Round-up - Nov 20 - Reliance Securities

What do brokerages say on Burger King India Limited's IPO?

The Phoenix Mills - Potential fund infusion may usher in growth - ICICI Securities

Godrej Agrovet - Beneficiary of 60% increase in palm oil prices - ICICI Securities

Automobiles (wholesale) - Wholesale dispatches rise amidst modest retail trends - ICICI Securities

Oil & Gas - Sector Update - Dec 2020 - ICICI Direct

Phoenix Mills (Buy): Asset monetisation at favourable terms... - ICICI Direct

Aditya Makharia's views on November Auto Sales Number for November 2020 - HDFC Securities

Burger King India - IPO Review - ICICI Direct

Quant Pick - LIC Housing Finance - ICICI Direct

Tech Mahindra - Analyst Meet Update - ICICI Direct

Gladiator Stocks - Crompton Greaves Consumer Electricals - ICICI Direct

Derivatives Monthly Outlook - Nifty support at 12800 for ongoing momentum...

Quant Pick - Sun Pharmaceuticals - ICICI Direct

Monetary Policy - Expectation from YES Securities

Sector Update on Asset Management Companies - Subdued but improvement expected - HDFC Securities

Pre Monetary Policy View - Dec, 2020 - Lakshmi Iyer, President and CIO (Debt) & Head Products, Kotak Mutual Fund

Maintain REDUCE on Siemens - Smart recovery priced in - HDFC Securities

Banking Sector Credit Trends - Growth continues to moderate - HDFC Securities

Q2 FY21 GDP: Light at the end of the tunnel - YES Securities

Siemens - Q4 FY20 Result Update - YES Securities

Super action in Home Loans - SBIN, ICICIBC, AXSB, HDFC and LICHF gaining share - YES Securities

Polymer price tracker - Dec 1, 2020 - PVC prices continue to tread higher - ICICI Securities

Bajaj Finance - Company Update - Dec 2020 - ICICI Direct

Siemens Ltd - Healthy revival in orders and margins - ICICI Securities

Covid Recovery Pulse - Nov 30, 2020 - Festive positivity continues in auto retails, e-way bill generation improves...

Derivatives Weekly View (November 27): Momentum expected to continue in broader markets with Nifty support at 12800...

Derivatives Strategy - Positional Option - ICICI Direct

Preview on RBI Monetary Policy - December 2020 - Shanti Ekambaram, Group President - Consumer Banking, Kotak Mahindra Bank

10 things you should know about Burger King India Limited

Views of HDFC Securities and Acuité Ratings & Research on Q2FY21 GDP Numbers

Rollover Report for November 2020 - December 2020: Angel Broking

Initiating Coverage on Godrej Properties - The housing factory - HDFC Securities

Burger King IPO - Angel Broking

Rollover Analysis - Record foreign inflows pushes Nifty to 13k - YES Securities

Ceramic tiles industry - Market share gains sustain for top branded players - ICICI Securities

Gas sector - CGD: Competition to hit margins, volumes and lead to derating - ICICI Securities

Cement - Prices resilient in Q3; consensus upgrades to continue - ICICI Securities

Specialty chemicals - Price trend in Sep-20 - ICICI Securities

Timken India - Q2FY21 Company Update - ICICI Direct

Upgrade in target price of IDFC First Bank - Angel Broking

Laurus Labs stake acquisition in Richore Lifesciences - Angel Broking

Shares of Lakshmi Vilas Bank (LVB) suspended from trading - Angel Broking

Initiating Coverage on Sundram Fasteners - Fastening growth - HDFC Securities

Astral Poly Technik - Scalability to further improve with storage tanks foray - ICICI Securities

Vardhman Special Steel - Q2FY21 Company Update - ICICI Direct

Initiating Coverage - Advanced Enzyme Technologies - ICICI Direct

L&T - Secures Large Contract - Nov 25, 2020 - Angel Broking

Alembic Pharmaceuticals - Tentative Approval for JV - Angel Broking

Drug launch by Lupin - Tacrolimus Capsules - Angel Broking



Website Created & Maintained by : Chennai Scripts
West Mambalam, Chennai - 600 033,
Tamil Nadu, India

disclaimer copyright © 2005 - 2019