Ladies and gentlemen, good day, and welcome to CDSL's Q2 FY 2024 Conference Call, hosted by HDFC Securities. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star, then zero on your touchtone phone. Please note that this conference is being recorded. Ladies and gentlemen, please note that CDSL does not provide specific revenue or earnings guidance. Anything said on this call which reflects CDSL's outlook for the future or which could be constituted as forward-looking statements, must be viewed in conjunction with the risk that the company faces. I now hand the conference over to Mr. Amit Chandra from HDFC Securities. Thank you, and over to you, Mr. Chandra. Yeah. Thank you, operator. So good morning, everyone. On behalf of HDFC Securities, we welcome you all to the CDSL Q 2 FY 2024 Earnings Call. We have with us today the management team of CDSL, represented by Mr. Nehal Vora, MD & CEO, Mr. Girish Amesara, CFO, and other senior leaders. We will start with a brief overview of the results by Mr. Nehal Vora, and then we'll start with the Q&A. Thank you, and over to you, sir. Thank you so much, Amit. Very, very good morning to all the listeners and participants, and welcome everyone. I hope each of you and your loved ones are safe and healthy. Thank you for joining us today to discuss CDSL's financial results for the Q2 for the new financial year, FY 2023-2024. We posted a detailed investor presentation on our website for your reference. I'm joined by the CDSL group's leadership team. Let me start with the industry highlights, and then take you through some of the key aspects of our performance. During the Q2 FY 2023-2024, the overall Indian capital markets demonstrated a healthy growth. The total Demat accounts as on September 30, 2023, stood at INR 12.96 crores, of which CDSL share was at INR 9.62 crores. The net Demat accounts opened in India in this quarter was at INR 91.58 lakh, of which INR 80.28 lakhs were registered with CDSL in the Q2 FY 2023-2024. The comparative numbers for CDSL were INR 52 lakhs for Q1 of FY 2023-2024, and INR 48 lakhs for Q2 of FY 2022-23. The total market capitalization of the market increased by 8% as on the end of this quarter, reaching INR 31,900,000 crore, compared to INR 29,600,000 crore as on June 30, 2023. Furthermore, the daily turnover for Q2 FY 2024 witnessed a 33% increase when compared to Q1 of FY 2024. These positive trends reflect the financial inclusion and more and more, and an increased participation by the investors in the Indian capital markets. These positive trends in the markets are also attributed to the recent industry advancements and regulatory measures. We believe these measures will benefit the industry in the long run by protecting the interests of retail investors and reducing the systemic risk. The 25th year of operation is also very special for us, as we celebrate the INR 9 crore Demat accounts milestone in July 2023, and further, I'm delighted to announce that CDSL has received a recognition for its excellence in digital execution. In October 2023, we were honored with the TechCircle Business Transformation Award. As we reach the midpoint of our 25-year journey, we remain committed to enhancing ease of doing business and instilling trust within the financial ecosystem. Our ongoing efforts have yielded promising results. The current financial year is also a representation where we have experienced a sustainable and healthy business and financial performance as a result of the efforts of all the market infrastructure institutions. Before I hand it over to our Chief Financial Officer, I would like to take a brief moment to place our appreciation and gratitude to all our stakeholders, beneficial owners, the depository participants, issuers, regulators, employees, and other market participants for their constant faith in us. We extend our heartfelt gratitude to our investors and the people of India, whose unwavering faith continues to guide us. Our focus remains steadfast on building value for our stakeholders and securing a robust Indian digital financial ecosystem. Thank you for your continued support and trust. Over to you, Girish. Thank you, Nehal. Good morning to all of you. Speaking on the quarterly performance on a consolidated basis, the total income for the quarter ended September 2023 has increased by 35% to INR 230 crore, as against INR 170 crore for the same quarter during the previous year quarter. The net profit for the quarter ended September 2023 is also increased by 35% at INR 109 crore, as against INR 81 crore for the same quarter during the previous year. Speaking on half-yearly numbers on a consolidated basis, the total income has increased by 28% to INR 404 crore, as against INR 316 crore. The consolidated net profit for the six months ended September 2023 has increased by 32% to INR 183 crore, against, as against INR 138 crore during the previous half. Speaking on a standalone basis, the total income for the quarter ended September 2023 is increased by 29% to INR 182 crore, as against INR 141 crore for the same quarter during previous year. The net profit for the quarter ended September 2023 increased by 28% at INR 88 crore, as against INR 69 crore for the same quarter during the previous year. Speaking on half-yearly basis, on a standalone basis, the total income has increased by 18% to INR 352 crore, as against INR 298 crore during the previous half. The consolidated net profit has also increased by 14% to INR 180 crore, as against INR 158 crore during the previous half. Now, I shall hand over to Sunil Alvares to give an update about operation of the wholly-owned subsidiary, CDSL Ventures Limited. Thank you, and over to you, Sunil. Good morning to all the participants. So far as CDSL Ventures is concerned, the Q2 FY 2024 operating income was higher by 67% as compared to Q2 FY 2023. The operational income was INR 43 crore in this quarter as compared to INR 26 crore in last same quarter, last financial year. The other income was at INR 4 crore as compared to INR 3 crore in the previous year. The total income was at INR 47 crore as compared to INR 29 crore in the previous quarter of the previous financial year. And so far as the expenses are concerned, the expenses were higher by 66% at INR 18 crore, as against INR 11 crore, as compared to the previous same quarter in the previous financial year. The profit before tax for this for Q2 FY 2024 was INR 29 crore, as compared to INR 18 crore for Q2 FY 2023, which was higher by 63%, and the net profit was higher by 61% at INR 22 crore, as compared to INR 13.44 crore in Q2 FY 2023. With this, I hand it over back for taking the question and answers. Thank you very much. We'll now begin the question and answer session. Anyone who wishes to ask a question, may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. Participants, you may press star and one to ask a question. First question is from the line of Swarna Mukherjee from B&K Securities. Please go ahead. Hi, sir, thank you for the opportunity and very good morning. Congrats on a great set of numbers. Coming a little muffled. Can you please speak through the handset? Yeah, yeah. Just... is this better? Yes, yes. Thank you. Yeah. Hi. Yeah. So, morning, sir. Thanks for the opportunity. Great performance for the quarter. Two, three questions. First one on the, IPO corporate action, line item. So I just wanted to understand, you know, how much of this, growth can be kind of sticky. So if you could give us some color or a quantifiable breakup on how much of this has come due to IPOs, how much through AGMs, et cetera, and how much through corporate actions. Also as to, you know, give us a flavor whether, you know, some part of this can be retained or whether there, there is a, you know, subsequent, substantial seasonal element in this. So that's the first one. Secondly, on the KYC, KRA business, if you could, you know, give us a sense why this, you know, the performance has been very strong, so whether the share of Fetch transactions have increased, or is it like the mix is relatively similar and volume-driven, because of which the growth has come? And, thirdly, on the cost side, so if I look at the tech cost, so, about a year back, it was somewhere around INR 9- INR 10 crores. It has steadily moved up from INR 15 crore run rate this quarter. So are we peaking out in terms of the run rate, or should we expect further increase in this, given that you have previously also highlighted the technology-intensive nature of the business? On the other expense increase, if you could highlight in the standalone business, what is driving that? I understand that maybe some inter-KRA charges is maybe in the KYC subsidiary, but in the standalone business, what is driving that? That's all from my side, sir. Okay, thank you. On your first question on IPO and credit corporate actions, it's kind of market-driven, so it's kind of difficult to predict, and we don't give any future pretty reference points, so we would not able to kind of give a picture of the future. That's for you to assess. Your second question was on the KRA charges on Fetch. And, so I think it's broadly driven by the buoyant market conditions, number of Demat accounts growing and participation growing, both in terms of delivery volumes, et cetera. We don't generally give the bifurcation on how much is Fetch versus... It's a consolidated number. Sorry, your third question was, Sir, before that, if I could just ask you, you know, even if quantifying this is possible, but if you could maybe somehow, you know, highlight whether this is very much Fetch because, you know, given the retail penetration, the, you know, penetration on the other financial products are also increasing, et cetera. So, I mean, is that an outcome of this? So that will help us. It's difficult to predict what has caused this outcome. It's kind of the overall buoyant market conditions, what has led to whether it's Fetch or increased KYC opening. It's a culmination of variety of factors, and it plays one upon the other. So it's difficult to give an answer, which would be absolutely give the reason. It's a multiplicity of factors which leads to this, and hence, we're not able to give you a specific answer on that. Okay, sir, on the previous question on the IPO and, other, you know, agents and corporate action, I don't want a forward-looking, guidance, but, if you could at least give us a, you know, break up between how much is due to IPOs and how much is due to other things, which will at least on a year-on-year basis later. Yeah. So basically, this is IPO corporate action. Income itself, the head itself is, you know, based on the IPO that comes in the market, so it is totally market-driven activity. Higher number of IPOs, we will be able to process higher number of- Due to IPOs. So that's the answer. Okay. All right, sir. On the cost, if you could, give us- The cost on the technology cost is something which is a constant, but as we are growing in number of accounts, we have to plan, and this is kind of a market infrastructure company. So, it has to plan for the rise and growth, and then infrastructure takes time, and technology infrastructure especially needs to only, not only be built with what the current trends are, but what are the future sophistications which are coming into the market. So it's going to be a constant in investment, which we will continue to do as we move forward. This will be in sync with what is expected, both from the regulators and the market, to ensure that we are able to give the best-in-class performance as we move forward. In terms of other expenses, I'll ask Girish to answer that. See, largely the other expenses, you know, if you look at our cost structure, you know, payment to SEBI is again related, based on my profitability and, you know, billing done for annual issuer income. So higher the profitability, higher the income, there will be higher cost on, on this account. Again, if you look at, inter-KRA expense, it would be directly proportionate to the business, the earnings that I do, on a top line in terms of KRA income. Unfortunately, there will be higher KRA in, inter-KRA charges. Having said this, you know, the certain cost will move in proportion to, the movement in the income. That's the submission I... Okay, sir, so on the regulatory bit, you, what you said, other expenses, so I was talking in terms of the split that you have given in the presentation, where I think the regulatory cost is booked separately. So excluding that, I was kind of interested in understanding for the standalone. So for the KYC, KRA, I have an understanding. For the remaining business, ex of regulatory cost was what I was pointing towards. So largely, you know, regulatory cost largely is on account of CDSL, okay? Mm-hmm. This is driven by the regulations, so we can hardly do anything about it. Yeah. So, sir, outside that, if you know, the breakup you have given, so there is one regulatory cost. The other head is other expenses, which has moved from last quarter at INR 41 crore to this quarter at INR 52 crores, and I think in Q4, it was at INR 30-odd crores. So I wanted to understand that movement, if you could help me. This, this being Q2, okay, our e-voting business would also have cost equivalently incurred. So, you know, e-voting expenses are there. Then we have consolidated account statement-related expenses. Then, you know, such kind of expenses are there, which would be there in Q2, mostly because the income corresponding is higher on in the Q2. Understood. So it is largely granular. There is nothing lumpy, or- Yes. Okay. Okay, got it, sir. Thank you so much, and all the best. Thank you. Thank you. Next question is from the line of Amit Chandra from HDFC Securities. Please go ahead. Yes, so thanks for the opportunity. So my question is on the, you know, account addition, Demat account addition. So obviously, we have, you know, seen a lot of traction coming back in terms of the additions, and it has gone to the, you know, at peak levels. But if I see the revenue for Demat, it has been coming down, and if I see the revenue for incremental Demat, it is also, you know, coming down. So how do you see the, like, newer account additions that are happening? So these are not contributing much to revenues. So how do you see this? And, you know, secondly, on the, on the private companies, Demat opportunity that has come up recently, there are around INR 14 lakh MCA-registered private companies, and, taking the lower slab, that comes to a bigger opportunity. So is there any timelines in terms of, you know, these companies getting, like, Dematted? So if you can provide some overview on that. So on the first question, Amit, is more of the building blocks getting created in terms of number of Demat accounts. How the investors will react to, as a group or as a collective group, will be dependent on how the market conditions are, et cetera. See, we are in the business of creating the right building blocks for the people to invest whenever there is an opportunity for them to they would like to really invest. And that, for me, is the biggest victory that from a financial inclusion standpoint, more and more people are coming into the ecosystem. And that will kind of play out over the long term. So we are not on a quarter-to-quarter game plan that, you know, what will be the revenue increase. It's more of a long-term, sustainable game plan, creating the right ecosystem and creating the right building blocks for us to take it forward from there. So that's the answer to the first question. On the second question, MCA has just, you know, recently put out this regulation. I think the timelines are given by, by September 2024, if I'm not mistaken. So I think, we are anyways, been doing this for a long time. So from a technology and system point of view, we are ready to go. It's for them to now kind of really, kind of approach then depositories for taking it forward. Okay. Sir, now, on the e-voting and e-CAS r evenue, if you can provide the breakup, what was the e-voting and e-CAS revenue in this quarter? Also, in terms of the private company opportunity, obviously, the time is of September, but is there any incremental cost that will incur or any incentive schemes that we earlier used to have incentive scheme for getting companies, because we have a lower, like, market share there. So are there any plans of investing in making that piece? So the first question, I'll ask Girish to answer, but the second question is on the... See, we have been very transparent, and that's been the foundation of our entire ethos. So whatever schemes we have, we put it out on the public domain. And I think it's the costs will be a function of as more and more people join the ecosystem, the technology infrastructure has to kind of be enhanced in sync with the increased participation, and to ensure that the service levels remain high quality. And therefore, there will be a constant assessment done and a constant investment done as to what is necessary and required to be put in from a technology standpoint. So again, I would like to repeat, that we are not in a quarter-on-quarter target point of view. We are more on a long-term, sustainable business. We are in that business of creating a market infrastructure. It's like building a road, and the value proposition will then kind of come over a longer period of time. So that's how we see ourselves as we move forward. First question, I'll ask Girish to answer. So the e-CAS income for the quarter is INR 7 crore, as against INR 5.5 crore in the same quarter previous year. e-Voting is achieved at INR 15 crore in this quarter, as against INR 14 crore in the same quarter previous year. Okay, sir. Thank you. Thank you. Thank you. Next question is from the line of Prakash Kapadia from Ambit Portfolio. Please go ahead. Yeah. Most of the questions are answered. I just have one question. You know, if I look at annual issuer charges, they are at the run rate of around INR 63 crore, which is, you know, a huge bump up on a year-on-year basis. Even last quarter, I think we were at this rate. So if you could give us some qualitative flavor on, you know, what is leading to this? Is it, you know, larger unlisted company revenues? Is it more folios, given buoyancy of capital markets? Is there some pricing impact, if you could give us some flavor? The pricing impact is obviously put out in a public domain. It's. There's no change there. But it's a combination of both the first two factors. It's the increased number of private companies coming into the fold, as well as number of folios in increasing, which leads to this increase to take place. So the point is that, as any growth is concerned, we are kind of our endeavor is to have multiple touch points to ensure that the growth remains sustainable. Touch points in terms of, business development activities, where, you know, we are ready for the opportunity as it comes, is what you're hinting at, Nehal? No, both things. Also ready from a technology point of view, but also ready from a, an ecosystem point of view. That, as more and more opportunities come and multiple sources of this, whether it be folios, whether it be private limited companies, so there are multiple sources of how the revenue would grow. So based on that, that is, basically how we are planning ourselves. Okay. And if it's possible to just quantify the revenues from unlisted companies, maybe at the year-end or in the first half, if you can just share a number? We generally don't share these numbers, so it'll be difficult for us to do that. Okay, fine. Thank you. Thank you. Next question is from the line of Paresh from Club Millionaire. Please go ahead. Hi, Nehal. Congratulations to you and your entire team for a fantastic performance yet again. Most of my questions have been answered, but maybe a couple of clarifications, and before I ask Girish, clarifications on the financial end. Nehal, your thoughts on, you know, the demand of having all the financial access in one place, right? We are losing your audio. Just one second... Is this better? Yes, yes. Thank you. Hello? Yes, yes. Yeah. It's fine. Yes. So Nehal, it is again, on the larger question, you know, longer term question of having all the financial assets in one place. Where are we in that journey? We've seen what the private companies, the unlisted private companies announcement has come through. But clarification on that, what will define a small company? And the newspaper article mentions the number of small companies is just about 50,000 out of, say, INR 13-INR 14 lakh companies which are on the private space. You know, clarification on that, what will be the definition? So we'll have to wait and watch because the regulations have just come in. Okay. The rules are yet to be notified. So I think that will is going through the process. And we are also kind of really examining this. But the intent is that, it's like any regulatory approach, it's basically a top-down approach, where the larger companies are first subjected to the reform. And then as the success grows, the knowledge grows, it kind of the meter would go to the remaining part of the group. So that's really the intent behind, and that's how is how they have gone about doing this. So, so Nehal, on the other, you know, other asset classes, basically, whether it's insurance, whether it's a commodities or whether it's mutual funds, any update on, you know, what is appropriate or any, what's the update on that? So insurance is anyways permitted through our subsidiary insurance repository. The mutual funds are on a voluntary basis. And I think the important thing from a India point of view, and that's how we look at ourselves, that for us India is the prime most focus, is that there's a unique identifier of PAN and PAN-Aadhaar combination, which kind of gives it that unique identity. So if it needs to get aggregated at some point, and even the account aggregator system is something which is also been rolled out. So that will give a lot of information and data on the investor to kind of pull for his or her consumption and for further analysis. And that's how we will see how the system evolves, matures and is taken forward. The right building blocks have been created to create a very strong foundation on which this entire structure can be built. Right. Your audio is not clear. Is it better now? Yes. Yeah. We just wanted to seek clarification whether you started charging the account aggregator in terms of a pay basis for the information that they seek? Not yet. Okay. And then, just some questions to Girish as well. To Girish, our revenues and profits both have grown by 35%, but actually the other expenses grew by about 40%. So do we have any one-offs on those expenses? No, there are no one-offs in the expenses. Okay. And then regarding the SEBI charges, Girish, you know, I saw that that's gone up by 50%, even though the revenues from a depository side are just up to 33%. Has there been any change or what actually led to a faster growth in SEBI fee this time compared to our depository revenues? The SEBI fees are basically based on the collection and not revenue. So if we have collected, say, revenue of previous year or, you know, before three years, then we have to pay 2% of those collected amount to SEBI. So, basically, you know, that's the reason how it works. Can you clarify that once again, Girish? For some reason, I don't understand. I thought it was a percentage of the revenue. Fees, the mechanism, the SEBI circular specifies that whatever annual issuer income that you- Mm-hmm. -that you levy to your customer, you collect that, and whatever is the collection amount, 2% has to be paid to SEBI as a fee. Now, suppose in this financial year, we have collected, say, for previous year or previous, previous two years. Mm. The incidence of tax would happen in this year. Okay. Okay. Understood. So whatever the pending receivables are, they get added on this year. Yes. Okay. And Girish- Has improved, that's the answer. Understood. Understood. So have you had any write backs because of that? Because we normally provide for the annual issuer charges. No, no, no. Okay. So Girish, just one more clarification on the same thing. For example, when there are transaction charges that will, these will also be included and be part of the SEBI fees, right? No, only annual issuer fees. Only annual issuer. Okay. Okay, fine. Thank you so much, and all the best to you all. Thank you. Next question is from the line of Supratim Datta from Ambit Capital. Please go ahead. Thanks a lot for the opportunity. Starting with the first question, if I look at your employee costs, and I'm talking about the standalone business. If the employee costs have stabilized, literally the Q1, should we assume this to be the runway going forward as well? So that's the first question before I go into my other questions. I think it'd be difficult. We don't give, it forward-looking statements. But the important thing is that, this is a specialized business. We need, really the specialized personnel. And as we embark on a growth journey, we will need to kind of earmark more and more people also, besides the technology increase, even the human resource needs to be enhanced to ensure that it's able to handle the increased growth. Got it. On the MCA and, you know, the notification by MCA, so, you know, like, people before me also discussed. So there are around 14-15 million companies, INR 14 lakh companies, INR 14-INR 15 lakh companies. Yeah. Out of this, how many would fall into this bucket of above INR 40 crore turnover? Do you have any sense around that? We are yet in analyzing this. It's just coming. But it will be the small companies which are kind of out of this Ambit. I don't think there is that number there at this stage, but this is something which we are analyzing, so I will not able to give you a definitive answer at this stage. Got it. And typically, we have seen that, you know, unlisted players have gone with NSDL as compared to CDSL. So are you working to, you know, on certain aspects to better target these companies as and when they come for Demat services? As I said earlier, I'm not in a quarter-to-quarter game, I'm not in a competition game. I'm here in for a long-term value proposition for India. And that has been our course as a management team, that you prepare to put across a platform which gives the best-in-class services to the people, and let the market choose whichever rather is the better platform. Like we've seen in Demat accounts, we were lower, we've increased. That has been the culmination of the long-term strategy. Same thing is what we will follow in terms of in this particular space also. Got it. Got it. Last question from my side. On the KRA charges, could you give a breakdown of how much of this would be coming from mutual funds and mutual fund account opening versus the Demat account opening? We generally don't give that number. I'm sorry, I'm not able to share it. Okay, but could you give a broad sense about which would be the bigger? It is, or if we don't give it, we give it. So it's actually difficult to say, because there are many brokers who offer, you know, credit of mutual fund securities in the Demat account. So if there is a record pertaining to a mutual fund which a broker is doing, okay, that could actually go into a broking account or a trade charge pertaining to that particular record. So it will be difficult to say whether a broker is doing it either for a mutual fund or for a security. Got it. And, final question from my side. On the insurance repository business, you know, one of your peers is working on launching an app which would, you know, not only be an insurance repository, but provide additional functions as well. As in, you know, you could have all your policies at the same place and, you know, other services. So are you also looking at, you know, enhancing this service? You know, how are you thinking about that business going forward? We have a new in management team now. We have a new MD and CEO who has joined the insurance repository, and he would be driving the entire strategy. I am pretty confident he would be driving this with a digital journey. That is something which we'll have to see in future. Got it. Okay. Okay, thank you. Thank you. Thank you. Next question is from the line of Arushi Shah from Sushil Financial. Please go ahead. Hi. Am I audible? No, ma'am. Can you please speak through the handheld? Hello. Now, better? Hello. Yes. Yeah, sorry for the inconvenience, and thank you for the opportunity. Just one question from my side. The transaction charges to see in our financial performance consolidated, which has increased substantially from Q1 to Q2. Is that because of new accounts are being opened or the absolute charges have increased? If you could throw some light on that. We don't charge anything for account opening. It's only on debit transaction that we charge. Okay. No, my, what I meant is that since new accounts are being opened, so like, the per account, whatever, or per, transactions what we charge, so since more transactions are... I'm just coming to that. So therefore, it's a culmination of both existing as well as new investors. And that can be showcased as I had put, given the industry highlight- Mm-hmm. As to how the daily traded volume, the delivery volume, et cetera, is growing quarter-on-quarter, this quarter as compared to the last quarter. Mm. So that kind of showcases the increased participation. So, uh- Difficult to really bifurcate between whether this is from new investors or it's from old investors. Uh- It's a combination. Okay. Okay, and also, like, per transaction or anything, our transaction charges have risen, like, in absolute terms? Like if we were charging INR 1, or we charge INR 1.5, something like that. We've actually brought it down. So we- Okay, so it's reduced. Yeah. We have actually introduced an additional layer of transaction charges. Mm. We have a layer-based transaction based on your. It's slab-based. Okay. We introduced a lower slab. ... Okay, okay. So it's more like a volume play, right? That's the correct way to read? Yeah. So more the volume, the lower the charges you pay. Okay, okay. Thank you, and congratulations on a good set of numbers. Thank you. Thank you so much. Thank you. Next question is from the line of Miraj from Arihant Capital. Please go ahead. Yeah, thank you for the opportunity, and, congratulations on a great set of numbers, sir. I have two questions. The first one is regarding the announcement that came some time ago regarding the settlement, T+1 hour settlement, which the SEBI is aiming to do by January, and later, subsequently by October, they are planning an instant settlement. I wanted to understand that, any infrastructure layout that needs to be put up, the expenses are supposed to be done by us. If yes, then have we incurred anything in this regard yet? And secondly, I wanted to understand that, is this play, is this idea of introducing T+1 hour settlement more towards, increasing volumes, or is there any other goal for this? And this was my first question, sir. Yeah. So, this is going to be a constant process of investment. As reforms happen, we need to kind of, and each market infrastructure institution will have to incur its own cost of implementing these changes, and whatever share is of both CDSL and NSDL will have to incur it themselves. So that's something which is something. The intent is it's going to be on an optional basis. It's very clearly put out by the SEBI chair, is giving more power to the investor to choose. And if him, he or she would like to get instantaneous settlement, moving towards an instantaneous settlement, thereby reducing the basically the credit the risk which is there in the system, where he, he or she can get the funds in immediately. So it is moving, giving more products for the person to opt for. Somebody can opt for a T+1 or a T+0, and finally moving to really an instantaneous settlement. Understood, sir. So in this regard, from our end, have we incurred any expenses yet to set up T plus one hour or instant? Yeah, it's a constant process, as I said, that we will have to. We are in a constant process of investment. The technical team is obviously working towards it to ensure that it is able, it is satisfied with the timelines which would be prescribed by SEBI in this regard. Understood. And my final question, sir, is that on the annual issuer charges revision part, if I'm not wrong, it is currently 11 annual issuer charges. Has there been any discussion on the revision part? Not yet. It's a constant process, so we've not yet, and we generally don't discuss our, the regulatory matters, in this forum. So that's something which is a separate discussion. Okay, got it. Thank you so much, and all the best for the future. I'll get back in if there are any further questions. Thank you. Thank you. Thank you. Next question is from Santosh, from Kesari Finance. Please go ahead. Am I audible? Hello. Yes, please. Okay. Thank you for such a great set of numbers. I had two questions. One is that typically, the number of additions that we are seeing in the Demat account. So looking at that, if you can share that, what is the incremental revenue we get out of every, Demat account that's created? Because typically, a customer is getting charged something like INR 500 per year, if my understanding is correct, but some brokers do not charge as much. For example, Zerodha is charging just INR 200. So we are not getting a sense that how much is the CDSL revenue from each incremental Demat account that comes, if you can just throw some light? We don't charge anything for the retail. So for retail, it's completely free. Okay, typically when- The non-retail corporate accounts, it's about INR 500 a year. Okay. So by retail, you mean the HUF account? Yes. The Hindu Undivided Family? Yes. And corporate is private sector, private, private companies and FIIs and- Yes. things like that, right? Yes, yes. Okay. So for any reason that you don't charge for Demat, because you are providing such a valuable service to, and it's one of the-- as you have been saying and maintaining all along, it's such a infra service, such a big, huge infra service. Then any reason that you are not charging? Is there a bar from SEBI or we are, we have decided not to charge? Barring SEBI, it's more to do with our responsibility towards the country also. We are kind of contributing to financial inclusion. While commercial aspects are critical, but also the market development is extremely critical as a team for us to continuously grow and our contribution to enhancing the sophistication of the securities market in India. That's one of the reasons why we want more and more people to come in into... Today, CDSL is there at 98%, 98%-99% of the pin codes in India. There has been a growth which has taken place in terms of number of Demat accounts. We want more and more people to join this ecosystem.... Therefore, the entry kind of remains, especially for the retail. We are trying to kind of really encourage more and more people to join the ecosystem, and hence there is no charge. Okay, okay. Great, sir. Proud of your services. Thank you so much. Thank you. Thank you. Next question is from Sanket Godha from Avendus Sp ark. Please go ahead. Yeah, thank you. Thank you for the opportunity. Sir, again on this question of private companies mandatory to be done Dematerialization of their shareholding. You probably are aware about the number of companies which are less than INR 4 crores paid-up capital or INR 40 crores turnover. But in a rough guess, how much that number would be, if you have any wild guess on that? Point number one. And second, given the value charge is INR 2,500 on the unlisted company, if such a big volume come, whether we can see downward pricing pressure from INR 2,500 to come down, which could have an impact on the potential revenue realization. That's my first question. So on the first part, I would not like to give any wild answers. I would like it to go through a proper working before I can reveal that. I'm not able to give any numbers on what are the numbers. Mm-hmm. In terms of the pricing, it's a function of various things, and anyway, the depository pricing is approved by SEBI also. Yeah. In terms of that, it will go through its own process, and I think it's a fairly low charge. Yeah. Our in-house helps get paid probably more than this, so I don't think companies should have a problem in kind of paying up these charges. They are very, very, very less and nominal. Got it. Got it. And the second question, what I have is that, so on KYC income, which has done well in current quarter. So there seems to be a very strong correlation when the IPO activity is very strong in the year, or in the quarter, then we see a very bump up in KYC income. So just wanted to understand, out of the certain INR 9 crore of KYC income, how much you can attribute to... Or directionally, how much you can attribute to the IPO activities? If it slows down in subsequent quarters, you will see a moderation in the KYC income. Actually, that's gonna be difficult, because when an entity fetches a particular record- Yeah. or creates a particular record, we have no clue whether it is because of an IPO or because, you know, he's using it elsewhere. So, that is something we will not be able to track. But, but it is safe to assume that, KYC, IPO activity have a meaningful impact on the KYC income growth, right? Absolutely, because IPOs will add to the number of Demat and brokerage- Yeah, but again, it's difficult for us to predict that it's only because of IPO or it's because of other factors. It's basically the participation in the securities markets. Mm-hmm. It will cause this impact to occur. Now, the participation is due to IPOs or due to secondary markets or due to mutual funds, is difficult to predict in future, and that's why we are really unable to say. Got it. Got it, sir. Few data keeping questions. I think in the past you have disclosed these numbers. First is on impairment cost, which has happened in the current quarter. Second is pledge income, and then third is annual issuer charges from unlisted entities. I'll ask Girish to respond. Annual, I think we are not disclosing the unlisted annual issue fees, but yes, margin pledge we are disclosing. Yeah. We received INR 4.19 crore income during the quarter. With respect to impairment- Yeah. The value is INR 3.3 crore in this quarter. Okay. So it has gone up, compared to last quarter, right? It was INR 1.7 crore. So, is this due to any specific reason or is this a conservative? If you understand the ECL requirement on the debtors provision, it is basically based on the history of the debtors. Now, in one quarter, there could be, you know, higher collection, and because of that, there could be a lower charge. So it will not... We cannot derive any fixed formula that, yes, in this quarter, the cost is going to remain the same, and accordingly, we can make predictions. That would not be possible to do for impairment. Oh, okay, sir. Perfect. That's, that's very much clear. Thank you. Thank you, sir. That's it from my side. Thank you. Thank you. Next question is from the line of Ajox Frederick from Sundaram Mutual Fund. Please go ahead. Hi, sir. Thanks for the opportunity. Just one question. You mentioned that online charges are dependent on Demat account opening, delivery volumes, and IPOs. So if I do a sequential comparison, Demat has gone up by 9% and delivery volumes by 41%. However, online charges are about 80% growth sequentially. So the gap, can I assume it to be IPO-driven? Yeah, you can possibly take that as your derivation, but we kind of... It's difficult to again predict that, whether it is only because of this factor or there are a multitude of factors which happen, which play upon that, because one can impact the other factor also. But as a broad thumb rule, probably what you have analyzed, you can take that. Just one clarification. The delivery, the income due to the delivery volume correlation would be for the depository business and not KRA business? Understood. That is very helpful. Thank you, Mr. Swami. Thank you. Next follow-up question is from Swarna Mukherjee from B&K Securities. Please go ahead. Yeah. Hi, sir. Am I audible? Yes. Yeah. So, on similar lines of what Ajox asked, I just wanted to understand that if I look at the growth in the number of Demat accounts, what is there in Q1 versus Q2, that growth is around 55%. So, given that, that revenue item has moved close to 80%, so I could not understand what is the difference of around, say, 20%-25% growth, revenue growth. So, some, you know, highlighting some details on that would be helpful. It's overall the market activity, because, see, whatever are the, we charge for the debits, we charge for the margin pledges, we charge for.... So it's again a multitude of factors. As I said, one transaction can. So one-to-one correlation on the factors is difficult to do, because it's a culmination of these transactions which lead to whatever is the income which is withdrawn out of that. Sir, just to clarify, under the online data charges, we only book the revenue from the KYC business, right? Or is there anything else also? That's right. That's right. That's right. Yeah. So I'm not sure, you know, I'm not getting how transaction charges will, how transaction and debits will also benefit this service, if you could explain? No, it depends on how the fetch takes place. Then what, whether that will lead to a debit, whether he has transacted in one stock or five stocks or 50 stocks or 100 stocks, that's difficult to predict. And whether that will lead to, whether that is done through one account or through many accounts. So whether the fetch for those many accounts will be much more, if it's one account fetch, it'll be less, but the transaction income will be more. So again, therefore, one is to one correlation is not possible to be done. That is the point I was trying to make. Okay, sir. Okay. All right. I'll, I'll take this offline for a little bit detail understanding. Thank you. Okay. Thank you. Thank you. The next follow-up question is from the line of Santosh from Kesari Finance. Please go ahead. Sir, thank you again for taking my question. I just wanted to know that what is the market share of CDSL in the business itself? CDRL? your KYC business. CVL, right? CDSL Ventures. So figures are in population, but, our estimate is about 65%. 65%. Okay. Our biggest competitor would be, It's only an estimate, so I think that should be very clear. Okay, 65%. Got it. So have you been increasing market share or decreasing market share, sir, over the past year or so? It's been more or less constant, I would say. More or less constant. Okay. Thank you. Thank you. The next follow-up question is from the line of Miraj from Arihandh Capital. Please go ahead. Yeah, thank you. Sir, just a follow-up on the same point I had earlier regarding the T+1 settlement. It is planned to be implemented from January onwards, so is there any circular on it that SEBI has released, or is this just— Is there any discussion paper or anything on that? Yeah, we should expect something. There will be a circular to that effect or a discussion paper. I will not be able to comment on how well the regulator will do it, but there will be a formal kind of an announcement. So what will be the timelines, et cetera, based on that. Okay. Thank you. That's it. Thank you. Thank you. Next question is from the line of Sanket Godha from Avendus Spark. Please go ahead. Yeah, thank you for the opportunity again. A small data keeping question is how many capital market records we have? Last year we ended up with around INR 55.5 crore capital market records. The similar number, what it could be today? Sorry, the question is not clear. What do you mean by capital market records? The KYC records what you have with you, which was around INR 5.5 crore for CDSL. September quarter, we had about INR 6.1 crore. Okay, perfect. And the second question, sir, was again a simple question, that given in the current year, promoters did a lot of selling, which means that the number of folios probably at the retail level will increase. So that benefit might not be reflected in the current year, right? Because what you have charged on annual charges is based on last year's number of folios. So that benefit should flow in FY 25 as the number of folios will increase. So my understanding is right there, sir? Again, I'm not able to predict how this will pan out over the next course of the next 2, 3 quarters. It only comes out by the end of the year as to how many folios are there. Again, these are forward-looking statements, so we don't, we don't give any forward-looking statements, so I'm not able to give a specific answer on this. Got it. Actually, my intention was to understand directionally that we charge annual charges- But tomorrow, my point is that tomorrow, in the next quarter, there could be maybe a reversal which could happen. The promoters start buying more and the retailers start selling. So how will I tell you that whether this is wrong, right, et cetera? So again- Got it. It will be what is at the end of the year, the folios, that the formula will be applied as per the numbers on that. Got it. Got it. Perfect. Perfect. Thank you, sir. That's it from my end. Thank you. As there are no further questions, I would now like to hand the conference over to Mr. Nehal Vora for closing comments. I'd like to thank all the people for their questions and participation. Please stay safe and well. Thank you. Thank you. Thank you very much. On behalf of HDFC Securities, that concludes this conference. Thank you for joining us. You may now disconnect your lines.