Both companies sit at the heart of India’s capital markets. They both handle the demat accounts and facilitate the electronic holding of securities.
But with both stocks correcting this year and valuations moving in different directions, an important question has emerged – Has NSDL’s sharp correction made it a better value buy, or does CDSL still deserve to trade at a premium?
To understand which stock currently offers a stronger investment case, FinancialExpress.com spoke to market experts. While they believe the long-term outlook for the depository business remains linked to the growth of India’s capital markets, their views highlight why CDSL continues to command a premium over NSDL.
Does NSDL’s correction make it a value buy?
NSDL has seen a steeper correction compared to CDSL this year, bringing down its valuation multiple. This has led some investors to wonder whether the stock now offers better value compared with its listed peer.
Responding to this, Nevil Dedhia, MD and Head of Institutional Equities at Equirus Securities, said, “CDSL is likely to continue trading at a premium to NSDL, owing to its strong linkages with discount brokers, which drive robust growth in demat account additions relative to NSDL. There may be phases – particularly in sideways markets – where NSDL’s market share improves, as demat account additions slow for discount brokers while traditional broker-linked accounts remain comparatively stable.”
According to Dedhia, although NSDL may benefit during periods of slower retail participation, CDSL’s stronger association with discount brokers continues to support faster growth in new demat accounts.
CDSL Vs NSDL: Which business model looks stronger?
Another key question for investors is whether a changing market environment could shift the balance between the two companies.
On this, Dedhia said, “Further, the depositories’ business model is inherently tied to demat account growth, since key revenue lines – annual issuer charges, transaction charges, and IPO/corporate action income – scale with the number of active accounts. As a result, CDSL’s medium-term revenue trajectory is more closely aligned with broader market activity than NSDL’s, which underpins its premium valuation. Unless NSDL makes meaningful inroads with discount brokers, CDSL’s premium is likely to persist.”
CDSL remains the preferred pick
Sharing her outlook on the depository space, Geetanjali Kedia, Chief Analyst at SPTulsian Investment Advisers, said, “CDSL is the leader amongst the two, and we like CDSL more than NSDL. Depositories are a duopolistic sector, and they are linked to the growth of capital markets.”
She further said, “Off late, depositories did not do very well on their earnings front because of the whole KRA issue, wherein there was pricing pressure in the KRA business. But the depository business has been growing and doing well. And if IPOs do well, then definitely it adds to incremental earnings for depositories. But of the two, we prefer CDSL.”
According to Kedia, while earnings were impacted by pricing pressure in the Know Your Customer Registration Agency (KRA) business, the core depository business continues to remain healthy. She believes the sector’s long-term growth remains closely linked to the expansion of India’s capital markets and increasing investor participation.
NSDL Vs CDSl: Which stock has an edge?
Asked about the outlook for the two stocks, Kedia explained why her preference remains with CDSL.
“We prefer CDSL over NSDL. CDSL looks better in terms of size, profitability and sustainability of earnings. It has higher profits from the core business and not other income. So, the quality of earnings for CDSL is better than NSDL,” added Kedia.
As per Kedia, the higher contribution from its core depository business and the sustainability of its earnings give CDSL an advantage over NSDL
CDSL Vs NSDL: How have the stocks performed?
The two stocks have seen different price trends over the past year.
CDSL has gained around 11% during the period. However, the longer-term picture remains weak. It has declined 4% in the last six months and is down 23% over the past one year. So far in 2026, the stock has fallen nearly 7%.
CDSL currently has a market capitalisation of Rs 28,180 crore. It trades at a price-to-earnings (P/E) ratio of 61.8. The stock has touched a 52-week high of Rs 1,784.80 and a 52-week low of Rs 1,116.30.
NSDL has also remained under pressure this year. The stock is down nearly 21% so far in 2026.
The company currently has a market capitalisation of Rs 16,690 crore and trades at a P/E ratio of 43.96. Its 52-week high stands at Rs 1,425, while the 52-week low is Rs 788.
Disclaimer: The views, stock analysis, and preference for CDSL over NSDL shared by market experts in this article are for informational purposes only and do not constitute specific buy, sell, or hold advice or a direct solicitation. Capital market investments and depository stock valuations involve inherent market risks, regulatory updates (such as KRA guidelines), and structural volume shifts. Investors are advised to evaluate corporate fundamentals independently or consult a SEBI-registered investment advisor before making financial decisions. This disclaimer has been generated using AI to support user well-being and responsible content consumption.
