NSDL IPO 2025: Key Facts About India’s Leading Depository Going Public

India’s premier depository, the National Securities Depository Limited (NSDL), is preparing to launch its highly anticipated Initial Public Offering (IPO) in 2025. This development has attracted significant attention, particularly due to the planned stake reduction by major shareholders such as IDBI Bank and the National Stock Exchange (NSE). The filing of an addendum to the Draft Red Herring Prospectus (DRHP) with SEBI provides a closer look into NSDL’s operations, financials, and strategic position in India’s securities infrastructure.

Overview of NSDL and Its Evolution

NSDL was incorporated in April 2012 as NSDL Depository Ltd and began operations as a full-fledged depository in 1996. It plays a pivotal role in dematerialising securities, facilitating seamless electronic settlement of trades in the Indian securities market.

The company later adopted its current name, National Securities Depository Limited, and over the last 26 years has built a robust reputation for offering reliable, technology-driven solutions to investors and institutions alike.

Core Services Offered by NSDL

NSDL offers a range of depository services including:

• Dematerialisation of securities
   
• Maintenance of investor accounts
   
• Margin pledge and inter-depository transfers
   
• Corporate action processing and dividend distribution
   
• E-voting, consolidated account statements, and SMS alerts

In 2007, NSDL introduced SMS alert services to its users, becoming one of the first to offer real-time communication to investors.

NSDL Payments Bank: A Key Subsidiary

NSDL operates a fully owned subsidiary, NSDL Payments Bank Ltd (NPBL), which focuses on digital banking services. NPBL started operations in October 2018 and follows a business-to-business model.

NPBL offers:

• Prepaid and debit card services
   
• Remittance and recharge facilities via mobile app
   
• Third-party distribution including insurance and mutual fund schemes

As of FY23, transactions through its prepaid cards were valued at ₹7,386 crore, with the nine-month FY25 total reaching ₹5,934 crore.

NSDL’s Financial Performance Over the Years

NSDL has demonstrated consistent revenue growth across three fiscal years. However, the contribution from core depository services has slightly declined.

The company has paid a dividend of ₹20 crore annually for the past 3 years. The dividend payout ratio has gradually decreased, dropping from 9.4% in FY22 to 7.26% in FY24 and 6.3% in 9MFY25.

Peer Comparison of NSDL vs CDSL

India has two major depositories: NSDL and CDSL. While CDSL leads in the number of demat accounts, NSDL dominates in terms of value held per account and total asset value.

As of December 2024:

• CDSL had 14.65 crore demat accounts
   
• NSDL had 3.88 crore accounts
   
• NSDL held assets valued at ₹1.25 crore per account on average
   
• CDSL held assets worth ₹5 lakh per account on average

Moreover, NSDL serviced almost 100% of the securities held by foreign portfolio investors in India, reflecting its trust among institutional participants.

Addendum to DRHP: What Has Changed?

In its recent addendum to the DRHP filed with SEBI, NSDL revised its IPO size from 57.26 million shares to 50.15 million shares. This revised information reflects updated financials and changes in the company’s capital structure.

Read More: NSDL Updates IPO Draft, Reduces Offer Size to 50.15 Million Shares! 

Stake Sale by Key Shareholders

IDBI Bank, which owns 26.10% of NSDL, plans to sell 22.22 million shares. NSE, with a 24% stake, will offload 18 million shares.

Other stakeholders selling their shares include:

• Union Bank of India
   
• State Bank of India
   
• HDFC Bank
   
• Specified Undertaking of the Unit Trust of India (SUUTI), which will sell 3.42 million shares

These sales are partly driven by a SEBI directive requiring institutional investors to reduce their holdings below 15% by October 13, 2025.

Corporate Structure and Management

NSDL does not have a designated promoter group. It is managed by a professional team led by Vijay Chandok, Managing Director and CEO, alongside executive directors and other senior managers.

Group companies include IDBI Bank and India International Bullion Holding.

Regulatory Proceedings and Risks

NSDL has faced regulatory scrutiny in the past. The Karvy Stock Broking case, which involved the misutilisation of client securities, brought NSDL into the spotlight. SEBI alleged that NSDL had not followed due diligence norms, though the company has responded to these claims.

Other SEBI notices have also been resolved over time, but the case involving Karvy remains under review.

NSDL’s Historic Connection with Protean eGov Technologies

NSDL was once a subsidiary of Protean eGov Technologies, formerly known as NSDL e-Governance Infrastructure. The two companies separated their businesses in 2012 through a demerger. Protean continues to operate in digital governance, while NSDL focuses solely on depository services.

Conclusion

NSDL’s IPO is expected to be a landmark event in the Indian financial landscape. With strong financials, a dominant position in high-value securities, and a rich legacy in the dematerialisation of assets, NSDL’s public listing will offer investors insights into a crucial part of India’s capital market infrastructure.

As IDBI Bank and NSE reduce their stake, this IPO also aligns with regulatory goals and unlocks long-term value from one of India’s most trusted financial institutions.

Disclaimer:

This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation or investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Investments in the securities market are subject to market risks. Read all the related documents carefully before investing.