Home Investment Memo: CDSL

Investment Memo: CDSL

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Our Rating:

Mehabe score: 8
G Factor: 6
Piotski Score: 8
The stock has a rating . The mehabe team score is reflective of its fundamental and technical merits. A rating above 8 is considered good buy. The stock has a G-Factor of 6 and Piotski score of 8.

Description

Central Depository Services (India) Limited operates as a securities depository in India. The Company offers service for a range of clients, such as depositary participants and other capital market intermediaries, corporates, capital market intermediaries, insurance companies and others.Site: CDSLMain Symbol: www.nseindia.com

Price Chart

Market Cap: Rs 13,914 cr Price: 1331.0 Trading pe: 63.8x
Book-value: 83.9/share Div yield: 0.34 % Earning yield: 1.92%
Face-value: 10.0/share 52week high: 1579.00 52week low: 337.00

Technical Analysis

  • Stock trades at 1331.0, above its 50dma 1105.8. It also trades above its 200dma 768.15. The stock remains bullish on techicals
  • The 52 week high is at 1579.00 and the 52week low is at 337.00

Price Chart

P/E Chart

Sales and Margin

Strengths

– is almost debt free.
– is expected to give good quarter
– has delivered good profit growth of 24.10% CAGR over last 5 years
– has been maintaining a healthy dividend payout of 42.69%
-Debtor days have improved from 34.34 to 25.21 days.

Weakness

– Stock is trading at 15.86 times its book value
-Promoter holding has decreased over last 3 years: -4.00%

Competition

– The industry trades at a mean P/E of 28.7x. Jubilant Ingrevia trades at the industry’s max P/E of 148.94x. CDSL trades at a P/E of 63.8x
– Industry’s mean G-Factor is 4.0 while the mean Piotski score is 9.0. CDSL has a G-Factor of 6 and Piotski scoreof 8.
– Average 1 month return for industry is 12.0%. The max 1- month return was given by C D S L: a return of 35.6 %

Quarterly Results

  • Sales for period ended Jun 2021 is Rs 117.0 cr compared to Rs 65.0 cr for period ended Jun 2020, a rise of 80.0%
  • Operating Profits reported at Rs 74.0 cr for period ended Jun 2021 vis-vis 38.0 for period ended Jun 2020 .
  • Operating Margins expanded 478.6 bps for period ended Jun 2021 vis-vis Jun 2020 .
  • The EPS for Jun 2021 was Rs 6.11 compared to Rs 4.95 for previous quarter ended Mar 2021 and Rs 4.42 for Jun 2020

Profit & Loss Statement

Profit&Loss Comments

  • Company reported sales of Rs 396.0 cr for period ended TTM vis-vis sales of Rs 344.0 cr for the period ended Mar 2021, a healthy growth of 13.1%. The 3 year sales cagr stood at 26.4%.
  • Operating margins expanded to 63.0% for period ended TTM vis-vis 62.0% for period ended Mar 2021, expansion of 100.0 bps.
  • Net Profit reported at Rs 218.0 cr for period ended TTM vis-vis sales of Rs 200.0 cr for the period ended Mar 2021, rising 8.3%.
  • Company recorded a healthy Net Profit CAGR of 24.1% over the last 3 years

Balance Sheet Statement

Cash Flow Statement

Cash Flow comments

  • CashFlow from operating activities was positive.
  • CashFlow from operating activities: Rs 193.0 cr for period ended Mar 2021 vis-vis Rs 82.0 cr for period ended Mar 2020

Sales Growth

Profit Growth Statement

Profit Growth Statement

Stock Price CAGR

Return of Equity

General Comments

– The company has improved its Return on Equity (RoE) metric. The RoE on Last Year basis was 25.0% compared to 20.0% over the last 3 Years.
– The stock has given a return of 281% on a 1 Year basis vis-vis a return of 71% over the last 3 Years.
– The compounded sales growth on a TTM bassis is 71% vis-vis a compounded sales growth of 22% over the last 3 Years.
– The compounded profit growth on a TTM basis is 75% vis-vis a compounded profit growth of 25% over the last 3 Years.

Ratios

Conclusion

– is almost debt free.
– is expected to give good quarter
– has delivered good profit growth of 24.10% CAGR over last 5 years
– has been maintaining a healthy dividend payout of 42.69%
-Debtor days have improved from 34.34 to 25.21 days. – Stock is trading at 15.86 times its book value
-Promoter holding has decreased over last 3 years: -4.00%

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