NSDL vs CDSL: How the two depositories compare as NSDL IPO hits the market

With National Securities Depository Limited (NSDL) set to launch its much-awaited Rs 4,011.6 crore IPO on July 30, investor attention has turned to how the country’s oldest depository compares to its listed peer, Central Depository Services (India) Ltd (CDSL). NSDL’s price band of Rs 760–Rs 800 per share—nearly 22% below its last reported valuation in the unlisted market—has surprised investors and renewed interest in the NSDL vs CDSL debate.

NSDL and CDSL are the two central depositories in India, responsible for holding securities such as shares and bonds in electronic or dematerialised form. They serve as custodians, facilitating the secure storage and seamless transfer of securities, thereby replacing traditional physical certificates. Regulated by the Securities and Exchange Board of India (SEBI), both depositories provide similar core services.

What are Depositories?

Depositories are financial institutions that store securities electronically, making the process of trading, settlement, and ownership transfer faster, safer, and more efficient. By eliminating physical certificates, they minimize risks such as theft, forgery, and damage.

Although both entities serve as vital pillars of India’s capital market infrastructure, their scale, customer base, financial performance, and business strategies differ significantly. Here's a complete breakdown of five key differences between NSDL and CDSL that every investor should know before betting on the upcoming IPO.

1. Origin and ownership structure

NSDL, India’s first and largest depository, was established in 1996 under the aegis of the National Stock Exchange (NSE). Its key shareholders include NSE, IDBI Bank, SBI, HDFC Bank, and SUUTI—all major financial institutions. The current IPO is a pure Offer for Sale (OFS) by these existing shareholders to comply with SEBI regulations.

CDSL, in contrast, was formed in 1999 by the Bombay Stock Exchange (BSE) and caters more to retail market participants. It became the first and only listed depository in India after its 2017 IPO. Its shareholders include BSE, HDFC Bank, LIC, and Standard Chartered.

2. Client base: Institutional vs retail dominance

NSDL primarily caters to large institutional investors such as mutual funds, insurance companies, and government bodies. As of June 2025, it manages over 4.04 crore active client accounts, including over 4 lakh debt instrument-linked accounts. It services over 29,800 companies, with more than 75% of their shares in demat form. The total value of securities under custody stands at ₹510.91 lakh crore (~US$5.97 trillion).

CDSL, on the other hand, is the depository of choice for retail investors. It has a far larger investor account base—15.86 crore as of June 2025—driven by aggressive growth in retail demat accounts. However, the total value of assets under custody with CDSL is significantly lower at ₹7.92 lakh crore.

3. Financial performance

NSDL’s performance in FY25 has been robust. It reported a 24.6% year-on-year rise in net profit to Rs 343 crore, with revenue growing 12% to Rs 1,535 crore. For the March 2025 quarter, net profit rose nearly 5% YoY to Rs 83.3 crore, and total income grew 10% to Rs 394 crore.

In contrast, CDSL witnessed a weaker Q4 performance. Its revenue declined 4.3% YoY to Rs 256 crore, while net profit dropped 22.4% to Rs 100 crore. Margins also narrowed, with EBITDA falling 27% to Rs 107.35 crore and operating margin slipping to 47.8%.

4. Market position and share

According to a CRISIL report, NSDL leads CDSL across several key metrics: number of listed companies, value of securities under custody, and transaction settlement volumes. It also has a higher demat market share, particularly among large institutions, during the first nine months of FY25.

CDSL, however, dominates in sheer account numbers due to its strong focus on retail. It plays a major role in dividend distribution, bonus issuance, and other corporate actions impacting individual investors.

5. Business model and operations

NSDL introduced electronic securities holding in India and remains a crucial link in capital market settlements and corporate actions. It operates through a nationwide network of depository participants (DPs) and facilitates secure holding and transfer of shares, bonds, mutual funds, and other instruments.

CDSL follows a similar framework but has positioned itself as more retail-centric. With simplified onboarding processes and broker integrations, it has captured a large chunk of India’s booming retail investor segment.

NSDL’s IPO offers a rare chance to own a piece of India’s original depository infrastructure giant. While it lags CDSL in retail reach, it outpaces its rival in institutional assets, market value under custody, and overall financial strength. For investors weighing between the two, the choice comes down to whether they value scale and institutional depth (NSDL) or retail dominance and listed history (CDSL).