Why this company is a strong bet on India's capital market growth
Subscribe to enjoy similar stories. The Indian stock market has undergone a radical transformation in recent years. With retail investors flooding the markets, a booming IPO landscape, and rising financial literacy, a quiet but powerful enabler has emerged at the heart of this shift—Central Depository Services (India) Ltd (CDSL).
A decade ago, the idea of millions of Indians actively trading equities seemed distant. Today, CDSL, India’s largest depository, is thriving on this very trend, benefiting from rising demat accounts, issuer fees, and transaction charges. Its capital-light business model, strong margins, and near-monopoly position in a high-barrier industry make it a compelling long-term growth story.
Over the past five years, CDSL’s stock has delivered a 10x return, fuelled by a surge in new demat accounts, increasing retail participation, and India’s prolonged bull market. Read this | Analysts sound alarm: CDSL's troubles far from over as market navigates challenges ahead But with such rapid growth comes an inevitable question—can it sustain this momentum? As financial markets evolve, CDSL stands at an inflection point. Can it continue to dominate, or will cyclical headwinds and regulatory shifts impact its trajectory? CDSL operates in the depository sector, a business with significant entry barriers and near duopolistic control.
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