Ladies and gentlemen, good day, and welcome to the Q2 FY 2027 results conference call of National Securities Depository Limited, that is NSDL. 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 touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Ms. Aarzoo Khandelwal. Thank you, and over to you, ma'am.
Good evening and welcome, everyone. Thank you for joining us today to discuss NSDL's Q2 FY 2027 financial and business performance. The recording of today's earnings call and the transcript will be uploaded on our website under the Investor Relations section. The financial results, investor presentation, and the press release are also available on the website. For today's call, NSDL is represented by Mr. Vijay Chandok, Managing Director and Chief Executive Officer, Mr. Subhash Kelkar, Executive Director, Critical Operations, Mr. Prashant Vagal, Chief Operating Officer, Mr. Jigar Shah, Chief Financial Officer, Mr. Samir Patil, Chief Business Officer, Mr. Abhijit Kamalapurkar, Managing Director and Chief Executive Officer of NSDL Payments Bank, Mr. Rajeev Gupta, Managing Director and Chief Executive Officer of NSDL Database Management, and myself, Aarzoo Khandelwal from Investor Relations.
The leadership team will give us a brief overview of the operational and the financial performance of the quarter gone by, which will be followed by a Q&A session. With this brief introduction, I now invite Mr. Vijay Chandok for his opening remarks.
Thank you, Aarzoo. A very good evening, ladies and gentlemen. Let me start by extending a very warm welcome and greetings of the season to all our Shareholders, Investors, and Analysts joining us today for the Quarter two 2027 earnings conference call. I sincerely appreciate the continued trust that all our INR 9.1 lakh valued shareholders have placed with us. We remain committed to building a stronger business, deepening our competitive position, and delivering sustained value to all our stakeholders. I am pleased to have you with us, as we discuss our performance and progress for Quarter two FY 2027. To place our performance in perspective, let me first briefly outline the broader market environment during the quarter. Well, as anticipated, the primary market activity rebounded strongly during Quarter two FY 2027 after a relatively muted first quarter.
During the first nine months of this calendar year 2026, India's primary market raised over INR 1.17 lakh crore through 244 IPOs, with nearly INR 90,000 of this being raised in Q2 FY 2027 alone, which included the landmark listing of National Stock Exchange. Investor participation remained healthy, with total number of demat accounts in India now crossing 24 crore, with nearly INR 90 lakh demat accounts getting added in Q2 FY 2027. When you compare this with Q2 FY 2026, that number was INR 79 lakh. So, the demat account addition during this quarter on a year-over-year basis was up by 14.2%. NSE's unique investors reach approximately INR 13.7 crore by the end of September 2026, compared to INR 12.9 crore that was at the beginning of the year in April 2026. Against this backdrop, let me turn the attention now to NSDL.
This quarter, our efforts remained centered around a few things, which I thought it's important to highlight. One is growing our customer franchise, second was improving our customer experience, and thirdly, it was strengthening the investor awareness. In that context, a few developments I would like to highlight, please, for your attention. Starting with our depository participant business, during this quarter, the total number of demat accounts for NSDL reached INR 4.72 crore. We also reached 320 depository participants. In this quarter alone, we added about four new DPs. If you look at H1 in the current year, we've added 10 in all. So, these depository participants provide services in more than 2,000 cities and small towns. We hold at present 86% of the value of custody, totaling to about $5.6 trillion, which represents 80% of that represents the equity base.
During Q2 FY 2027, we added INR 15.6 lakh net demat accounts, reflecting a continued account addition during the quarter. Market share came in at about 17.2% in Q2 FY 2027, compared with 17.6% in the sequential previous quarter. For H1, however, our market share increased to 17.4% from 16.6% in the corresponding H1 of 2026. Fintech brokers have continued to get added, and today they account for 23.5% of our incremental demat account sourcing. So, it has crossed 20% now, and that stands at 23.5% at the end of Q2 in Q2 2027. You compare this with Q2 of FY 2026, that number was only 9.3%. So, this clearly reflects the growing ability of NSDL to attract the new-age fintech brokers, thanks to our investments in technology.
We would also like to highlight our continued traction in the YUVA Plan, the youth plan that we launched, and the Women Plan, which now together account for approximately 45% of our incremental demat account additions in Q2 FY 2027. Coming to our issuer and key value-added business services, we continue to expand our investor base, which has now crossed INR 1 lakh 18,000 issuers. Market share in the unlisted issuer segment stands in at about 72.5% in Q2, with 3,197 companies getting admitted to the platform during this quarter. The total number of events on our e-voting platform increased in the quarter to 3,160 from 2,924 last year same quarter, and our market share remains broadly stable at about 52.4% in Q2 FY 2027.
Further, during this quarter, we focused on driving greater adoption of the 68 + APIs that we introduced for DPs in the current as well as some of the earlier quarters, clearly helping us enhance customer experience, improve service delivery, and improve customer feedback across the depository ecosystem. We also achieved an important milestone with the pilot launch of the DEMAT 2.0, which is a next-generation platform which leverages the distributed ledger technology to support tokenized securities and enable real-time settlement through integration of the Reserve Bank of India's CBDC, or the Central Bank Digital Currency, infrastructure. We enabled online submission of Form 121, which was announced by Honorable Finance Minister in the budget, through NSDL's corporate website, simplifying compliance and providing issuers and stakeholders with seamless digital integration.
We established an API-based interface with the National Stock Exchange to automate the creation of EGRs, or Electronic Gold Receipts, clearly improving process efficiency and supporting digitization of physical gold ownership, a business that is expected to grow in future. We also introduced API connectivity for online bond platform providers, the OBPPs, enabling real-time account and holding validations, electronic instruction submission to verify investor transactions in the bond market, and clearly this is giving impetus to bond OBPP platforms and bond investments in the country. NSDL supported SEBI's nationwide Project Jagruk, which was launched in October at the hands of the Honorable Chairman of SEBI, by sharing the program in which we are sharing investor awareness messages in English, Hindi, and 11 other regional languages across the country, and NSDL leveraged its platform and DP ecosystem to do the same.
In quarter 2, FY 2027, NSDL conducted more than 1,259 multilingual investor awareness programs, reaching out to over 55,000 participants across 10 states, union territories, through online, offline, and hybrid formats of training through corporates, defense services, educational institutions, and women-focused forums. We also strengthened our leadership team with the appointment of experienced professionals. I had mentioned it perhaps in the last quarter, Mr. Subhash Kelkar has joined us as Executive Director, Critical Operations. He brings nearly 36 years of leadership experience in technology and capital markets, and most recently served as the CTO at the Bombay Stock Exchange. Mr. Ankit Sharma joined as Executive Director, Regulatory and Compliance, bringing in 31 years of experience in regulatory policy, compliance, and governance. He most recently served as the CRO, or the Chief Regulatory Officer, Listing and Investor Compliance at the National Stock Exchange.
We also welcomed Mr. Ashish Dandekar as the CTO. He brings in about 35 years of experience across technology and advisory roles, including experiences at the National Stock Exchange and the Power Exchange India Limited. While Jigar will take you through the detailed financials, I would like to mention that for quarter two, FY 2027, at a consolidated level, our revenue for the quarter stood at INR 582.6 crore compared to INR 432.2 crore last year, up by 34.8% on a YoY basis. Profit after tax stood at INR 122.2 crore compared to INR 110.4 crore last year, up by 10.9% on a YoY basis. Well, the above numbers have to be viewed in the context of the fact that we are in a technology-building phase. We continue to invest in technology resilience, cybersecurity, operational automation, use of AI, cybersecurity, and critical talent support for future growth.
The pace of investment in critical talent, however, I would like to highlight, has now started moderating. As these investments mature in future, we do expect operating leverage to support margin normalization as we move forward. We remain firmly committed to upholding the highest standards of investor protection, strengthening trust, and advancing financial literacy to foster responsible participation in Indian capital markets, and of course, strong focus on governance. We would like to thank the Ministry of Finance, SEBI, RBI, and also all our DPs, issuers, investors, market intermediaries, shareholders, and employees for their continued support. With that, I will hand over the mic to Jigar for taking you through the financial highlights. Thank you.
Good evening, everyone, and thank you, Vijay. Let me now take you through our standalone consolidated financial highlights briefly for the quarter ended 30th September 2026 and for the half year, FY 2027. For the quarter two FY 2027 standalone, our revenue from operations for quarter two FY 2027 stands at INR 227.8 crores versus INR 204.2 crores in quarter two FY 2026, that was a year ago, registering a growth of 11.6% on year-over-year basis, and sequentially, we grew by 25.1%. Our total income for quarter two FY 2027 stands at INR 279.8 crores in quarter two FY 2027 versus INR 250.6 crores in quarter two FY 2026, a growth of 11.7% on year-over-year basis, and sequentially, we grew by 27.4%. Just to make a note that ex-dividend, our growth stands at 19% on sequential basis.
Our EBITDA for quarter two FY 2027 stands at INR 171.6 crores versus INR 160.7 crores in quarter two FY 2026, registering a growth of 6.8% on year-over-year basis. Our EBITDA margin for the current quarter stands at 63%, and ex-dividend, it stands at 58.6%. Our net profit for quarter two FY 2027 is at INR 126.7 crores versus INR 120.4 crores in quarter two FY 2026, a growth of 5.2% on year-over-year basis, and sequentially, we grew by 42.1%. Ex-dividend, we grew by 21.6%. Our PAT margin for the current quarter stands at 45.3%. Ex-dividend, our PAT margin stands at 41.4%. I would like to share a brief update on the first half year, which is half yearly FY 2027 standalone highlights. Our total income on a year-over-year basis registered a growth of 13.3%. It grew to INR 499.5 crores.
Our net profit after tax for H1 FY 2027 grew by 6.3% on year-over-year basis, and our net worth on standalone basis stands at INR 2,263.4 crores. On the technology front, as part of a practice, we update what we have capitalized in the H1. We have capitalized INR 23.9 crores in H1 FY 2027, versus last year full year number was INR 106.1 crores. It is worth noting that NSDL's standalone profit contributes approximately 88% of total consolidated profit. Let me briefly touch upon few operational developments across our subsidiaries. As far as NSDL Payments Bank is concerned, we are pleased to say that NPBL RuPay NCMC Smart Cards reached INR 1.3 crore MSRTC registration and over INR 100 crore in cumulative card loads in October 2026. That is the latest update. Supporting concessional bus travel in Maharashtra under government mandate effective September 4, 2026.
It's a very important milestone for us because that supports our float as far as the NSDL Payments Bank is concerned. On customer deposit front, we saw growth of 1.6x in retail customer base, growing to INR 54.3 lakh customers in Q2 FY 2027. A year back, this number was INR 33.5 lakh. The deposit balances grew 1.4 x to INR 378.1 crores. Now, coming to another subsidiary, NSDL Database Management. With NSDL Database Management, our KRA records registered intermediaries grew to INR 2.06 crore records as of September 30, 2026. I would also like to briefly update you on the insurance business. Following IRDAI guideline, NDML incorporated NDML Insurance Repository Services Limited and filed a demerger application with NCLT Mumbai to transfer the insurance repository business. As of today, the cumulative number of dematerialized insurance created on our platform stands at INR 1.75 crore policies.
Both of these subsidiaries are profitable and very important part of our strategy. With that, I will briefly update on the numbers with regards to Q2 consolidated financial highlights. Our revenue from operations for Q2 FY 2027 stands at INR 545.9 crores versus INR 400 crores in Q2 FY 2026, registering a growth of 36.5%, and sequentially, we grew by 5.7%. Our total income for Q2 FY 2027 stands at INR 582.6 crores in Q2 FY 2027 versus INR 432.2 crores in Q2 FY 2026, a growth of 34.8% on year-over-year basis, and sequentially, we grew by 3.9%. Our EBITDA for Q2 stands at INR 178.5 crores versus INR 158.8 crores. We are registering a growth of 12.5% on year-over-year basis. Our EBITDA margin on consolidated basis for the current quarter stands at 30.6%.
Finally, our net profit after tax for Q2 is at INR 122.2 crores versus INR 110.4 crores a year ago, Q2 FY 2026, registering a growth of 10.9% on year-over-year basis, and sequentially, we grew by 24.6%. Our PAT margin stands at 21% for the current quarter. For the first half of 2027 on consolidated highlights, as far as H1 is concerned, the total income we have registered a growth of 46.7% to INR 1,143.1 crores, while net profit after tax for half yearly grew by 10.4% to INR 220.8 crores. With that, I will conclude my opening remarks. Once again, thank you for joining us today, and I will open up the floor for Q&A session. Thank you.
Thank you, sir. We will now begin with the question and answer session. Anyone who wishes to ask a question may press star and then one on their telephone. If you wish to remove yourself from the question queue, you may press star and then two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue is assembled. A reminder to all the participants, you may press star and one to ask a question. We have the first question from the line of Rishabh from RBSA Investment Manager. Please go ahead.
Yeah, thank you for the opportunity. I just wanted to get a sense on the DEMAT 2.0 opportunity that you mentioned in the press release. You could speak about how does it increase our overall TAM and what stage of commercialization are we in, and do we have a first-mover advantage here?
Yeah. Thank you for your question, Rishabh. This is a pilot launch, first and foremost. This is in the sandbox of SEBI. The intent is to take the entire depository platform to a completely new advanced technology using blockchain as opposed to the conventional model. This is an initiative which is driven by SEBI. The new model is based on DLT technology. It is right now restricted to only the bonds. How does it give advantage to the investors and to the market? Unlike the current traditional process where the settlement process takes place either on T+1, T+2, or T+3, I am talking about bonds, depending on the type and category of the bonds. Anything which comes as tokenized bonds will come within a settlement mechanism which is instantaneous. It is exactly like similar to UPI, where you just remit the money and the receiver gets it.
It is similarly you remit the payment and you get the bond immediately. Right now, in the first phase of the pilot, it has been launched mainly for only the issuance service. The secondary market development is still planned. It is work in process, but SEBI expects that to be completed by us as well. That would be in future. SEBI has started off this whole initiative of tokenization with bonds. Obviously, the intent is to watch the actual experience because it is a new concept. Globally also, this is a relatively new development, so there are no global experiences to lean on, really. This market is likely to evolve as time goes forward based on the experience, feedback from the investors.
This is being done jointly by CDSL and NSDL, so it is not as if we are, in a sense, got early mover, but we have moved together. We have seen three issuances on the platform so far. The total value of the three issuances, these are bond issuances, primary issuances, I think a little over INR 1,000 crores. This platform uses, as I mentioned, CBDC for settlement, so you can't use your traditional rupee money for making payments. You have to open a wallet account with the designated RBI bankers who have this service. For opening the new DEMAT 2.0, you don't need to do additional KYC. You simply extend it to your own sort of existing DEMAT account to open this DEMAT 2.0 based on a request. It is also right now open only for the institutional market, so it is not open for the retail investors.
Based on the experience of retail investors, based on the development of the secondary market trading capabilities, SEBI will evaluate what are the next steps that we have to do. I think the exciting thing is that it is a segue of opening a new horizon of investment sort of avenue, which is tokenized bonds. Tomorrow, there could be tokenized other instruments, financial instruments that can also emerge. It is a whole new market opportunity that could open in future. That is obviously subject to regulatory developments and evolution.
Okay. In the currently base business, of course, we have certain plans of getting higher incremental market share in the new BO accounts that are opening. Where are we in the journey? I believe last one year we had done a lot of fieldwork. Next one year, what is the outlook on that? I understand we are getting some traction on the fintech side, but what is the outlook for the next one year? Things are as planned?
Yeah. Rishabh, this is a priority number one for me, priority number one for the company to try and increase market share on the retail side, because we are already very strong on every other market share. Whether it is on the institution side, API side, bond side, unlisted company side, as well as e-voting and all other value-added services, we have a very, very high market share, a dominant market share. The only place where we have a market share catch-up that we need to do is on the retail investor side. You need to appreciate that the journey is going to be not an easy one, because we have to win some of the investors, and these investors in the market, as you are aware, are very concentrated. The top three DPs dominate virtually 60%, 65% of the market.
Those three are w ork is in the happening, along with the non-top three, where a lot of progress has been made. We have added, in the last one and a half years, about 30 new DPs. Many of them are fintechs, and our market share has also started climbing up on a run rate basis. Our run rate market share was 9%, then it went to 12%, then it went to 14%. It is today between 16%, 17%, 18% [Non-English content] , it keeps varying in that range. As these new DPs that we have acquired start scaling up their business, the expectation is market share will go up. How it will scale up will depend on the market movement as well as how the new DPs start gaining market share within themselves. Work is definitely on.
The technology upgrades are being done to a large extent, and we continue to invest in ensuring that we are on top of this game. What was difficult about two years back or one and a half year, 18, 20 months back, which is attracting new investors itself, new DPs itself was very difficult. I think that journey is now behind us. Many new DPs have joined us, including fintech DPs, large DPs. Many of them are very promising. We are optimistic about the future, but we are not giving any specific guidance.
Okay, sir. That's good to know, sir. Thank you, sir.
Thank you. We have the next question from the line of Prayesh Jain from Motilal Oswal Financial Services Limited. Please go ahead.
Yeah, Hi. Just looking at your financials, do you think that the IPO and the corporate action momentum that we saw in this quarter, given the pipeline of the IPOs or whatever has been executed so far, what do you think about the momentum in this part of the business going ahead?
Hey, Prayesh. Hi. Thanks for asking.
Prayesh, I thought you will be having an IPO list bit more than we will be having, yeah?
Yeah.
Yeah.
I mean, as you can see, year-on-year, we've grown about 24%. And the IPO pipeline, whenever it's strong, it adds alpha to our existing business. And we have said this in the past also, the IPO adds roughly about 25%-30% of our business whenever there is an additional pipeline. So as and when there is a more activity, and we expect this little bit to continue. I mean, obviously, October we saw a couple of, or still one big IPO. We expect if the momentum continues in the market and if the SEBI continues to approve the list on its website, this should help the company, and it should go at the pace that we have reported this quarter.
Got that. And the unlisted shares, unlisted companies, right? There, we have seen slowdown for about few quarters now. Would that be in the base from, say, 3Q or fourth quarter? Still we'll have the effect coming in 3Q, and the slowdown would be there. Any major changes out there? How is the kind of activity picking up there?
Yeah. Prayesh, as you are aware, this is based on the definition of MCA, which requires companies to dematerialize their shares for non-small companies. The definition had changed. [Non-English content] we saw dip in the sourcing. I think last two quarters se broadly it stable [Non-English content] . I think we are in that ballpark of about 3,000 or thereabouts. If that were, if we were to go by the recent couple of quarters, it looks like it seems to have sort of flattened out from here. I think further dips may not be warranted.
Yeah, I think we are at a saturated cycle right now. If you look at last year, we onboarded about 30,000 companies. Prior to that, we onboarded 33,000 companies. This year in H1, we have onboarded about 6,500 companies. That shows the kind of saturation, and also we have covered a lot in the last two to three years and dematerialized a lot of companies in the country. That also kicks in after a point in time.
Got that. Just one bit on the expenses front, we have been investing heavily in tech. In fact, honestly, I do not know whether you will answer this or not, but still taking an attempt here. We have seen both the depositories spending heavily on tech, right? It is not just been one year, it is been about two and a half, three years that we have seen both the depositories spending heavily on tech, right? Where does it go for us from here? Have we kind of reached a level where the investments Obviously, investments will continue, but whether the pace of increase in investments or expenditure will kind of slow from here? Should we think about on an annual run rate basis in terms of tech expense, at least in this year and next year going forward?
There are some very exciting developments which are taking place in the market. The last two years, I mean, I am calling this the second year as the two years, the current year as the second year, and maybe two years almost done. We are halfway, a little more than halfway done actually as we speak. I think we have done a lot of catch-up, at least as far as our company is concerned. From here, the phase now becomes more of leg up rather than catch up, where we try to get ahead, put our nose ahead of the market by putting innovation out there, by putting more use of, I would say, product development, more use of technology for product development, more use of technology for AI, cybersecurity, those areas.
So, one has to look at technology investment as a medium-term business enabler, really, rather than just an expense, and that is how we see it. I did mention in my commentary also that as these expenses normalize, this year, I think broadly it is going to be flattish compared to last year. Not too much different actually. Marginally, there could be some difference. We do believe, well, we are yet to sort of make a very specific action plan for the coming year, while we have an approximate action plan. But a very specific fine-tuned action plan will be rolled out in the next few months, for the next financial year I am talking about. As things stand, it should be similar to last year, but more from a catch-up to a build-up mode, rather than a catch-up mode.
All right. Thank you so much.
Thank you. We will take the next question from the line of Lalit Deo from Equirus Securities. Please go ahead.
Yeah. Hi, sir. Good evening. Sir, just one question. So now, given the current market situation, like last quarter, we had highlighted that the total folios on the listed issuers were broadly flattish from March, and it was somewhere around INR 14 crores. Just wanted to understand, in the current market scenario, how is that number looking at now? I think we will start off with the details.
Yeah, it's the same number. I mean, we'll give you this number once when full cycle goes out. So right now, it's just a flattish, the same INR 14 crores what we had highlighted in the earlier quarter. Because it takes time to eventually, the activity takes time, it comes with a lag. So we'll come to know in the next March or annually once we see the folios go up in the listed as well as the unlisted companies. So maybe another few months and we'll update you with the number.
Got you. Yeah, that was Thanks.
Thank you.
Thank you. We have the next question from the line of Amit Chandra from HDFC Securities. Please go ahead.
Yeah. Thanks for the opportunity. My first question is on the pricing part. Was there any component of price increase in the IPO revenues? Because there was an increase in the IPO verification charges. What was the quantum there? Also, if you can update us on what is the status of any talks in terms of the pricing for the issuer charges, because obviously it has been extending for a while. Now, as our cost base has been increasing significantly in terms of and we have been investing. Is it not a very solid case for us to present ourselves in terms of getting a price hike?
Yeah. As far as, specifically you asked about the price increase on the IPO, there has been no price increase. We have been still at the same pricing. On the settlement charges, I think we did mention that there has been a conversation which has been going on with regulators now for a long time. It has been more than one year plus. But it remains unaddressed even as we speak. So there has been no development. In the meantime, costs, as we guided, we sort of in a way mentioned that we are going through an elevated cost cycle because we are investing in tech and some specific skills. So those are kicking in, but there are no progress, or I would say, outcomes to report as far as price increases are concerned.
Okay. In terms of the total accounts that we have, if you can provide us the exclusive number of demat accounts we have, and also in terms of how many KYC records we have with us. Plus, the exclusive accounts that we have, what is the level of activation there in terms of how many accounts within that would be, say, holding within that would not be holding any securities in that. Also, the contribution of the youth account which we had opened in the last two years. What would be the contribution of that in the overall?
I will try to give you two numbers and then you can follow up. First number is, to your eyes, I think total number of demat accounts, what we have today, INR 4.72 crores. The other one is how much record we have with regards to our KRA business, it is INR 2.06 crores record that we hold in our KRA business.
The activation rate means how many accounts within the exclusive ones would be like zero holding?
See, as far as unique, I think you also asked unique, right? Most of our accounts, I mean, if you have to Again, these are high-level thought processes, but more than 80% stands unique as far as our accounts are concerned.
Okay.
That's where that also Because it's unique, we also have a larger revenue per account, because that's another number which we keep giving, so that's the reason.
Okay. Okay, sir. Thank you.
Thank you. A reminder to all the participants, you may press star and one to ask a question. We have the next question from the line of Rakesh Kumar from Valentis Advisors. Please go ahead. Rakesh, please proceed with the question.
Yeah, can you hear me now?
Yes, you are audible.
Yeah, yeah, thanks. Just coming back to the same question on IT that we are doing. If we look at, we have been creating negative operating leverage because of three line items on the expense side, employee, technology, and depreciation obviously coming automatically because of the fixed asset that we are creating. And total income is growing by around 13%. These three items are growing by more than double. As you mentioned that some part of it is like in a catch-up phase rather than the build-up phase, if I heard you correctly. The first question is that, when we get, like how much more time we will take to get into the build-up phase? I think when you get in that phase, your growth number on the expense side should normalize and should not be at least this much.
If you can give your inputs on this question, sir.
Yes. You are asking some questions which are more in the domain of guidance. We really refrain from giving any guidance, but you please appreciate that base effect will start kicking in because we are starting with a base where the expenses were negligible. Just to give you a sense of the numbers, one year before that, our OpEx CapEx was about INR 30 crores. We elevated that to more than INR 100 crores. From there on, things have sort of flattened out. The base effect kicks in, and once the base effect kicks in, automatically the percentage increase starts flattening out. I would expect from next year things will start flattening out. Meaning the kind of increases that we saw last year will not be there.
Okay. From the next year onwards, you are thinking that this kind of negative operating leverage?
I am not saying about negative operating leverage. Before negative operating leverage starts kicking in, you need to show normalization of expenses and then operating leverage kicks in.
True.
We will wait for that to play out. It is also dependent on market conditions. So very difficult to commit a certain timeframe. Our endeavor is from a mode of a lot of spending, we are reaching a stage where we are looking at very discriminate spending, value-added discriminate spending. In the last one and a half years or so since we have been doing this elevated spend, or pretending to two years now, I am assuming this year is all budgeted for, planned, and underway, most of it was a must-do. From here onwards, there can be a good-to-do kind of a spend which comes in. That gives us a little more leverage to sort of do what is really required.
Got it. Thank you. Thank you, sir. Thank you.
Thank you. A reminder to all the participants, you may press star and one to ask a question. A reminder to all the participants, you may press star and one to ask a question. We have the next question from the line of Anshuman. Please go ahead.
Hi. Thanks for the opportunity. Sir, any update on the NSDL Payments Bank operation in terms of we were engaged and there is a decent traction we saw in the first half. Any update on that business would be helpful.
Yeah. Anshuman, thanks for asking this question. If you see our segment results also, from INR 1.8 crore we have gone to about close to INR 5 crore plus. We have been explaining this, and in my commentary also I covered that the number of customers onboarded by the bank has multiplied by 1.6 x to INR 54 lakh customers we have. We have close to INR 378 crore in deposits. The growth is visible in the bank with regards to acquisition of customers, with regards to the acquisition of deposits. Apart from these two businesses or the focus area, the other focus area which we started off about 18 months ago was UPI acquiring business.
And if you see, I mean, we have not given the UPI numbers, but the UPI business have seen an uptick, which is tying up partnerships with other payment gateway providers, other payment ecosystem to ensure the UPI transactions are settled through payment bank. And that is where you see the large growth that is coming in or significant growth that is coming in. And that is where our profits from the subsidiary probably a year or one and a half years back was about 5%. Today, the subsidiaries are contributing more than 10%. These are the two focus areas, I would say, with regards to the NSDL Payments Bank, which is giving us the growth and the profit numbers.
Right. I am just trying to understand, is there any possibility of benefit from the MDR on UPI?
This is a gradual process. The MDR on UPI, it came, then it is now on a pause mode. As and when it is once again sort of declared, we will see how it works for NSDL Payments Bank. And if it works for the overall ecosystem, it will work for the bank as well. But we have not quantified as of now.
Understood. Thank you. Thank you.
Thank you. A reminder to all the participants, you may press star and one to ask a question. Thank you very much. Ladies and gentlemen, that was the last question. And with that concludes the question and answer session. I now hand the conference over to Mr. Vijay Chandok for the closing comments. Thank you, and over to you, sir.
Thank you so much. I sincerely want to thank all the Investors for joining in today, all the Analysts who are covering us, and all the Shareholders who've been patient with us. Thank you very much. Wish you once again, all of you and your family, a very, very happy upcoming and greetings of the season. I am sure there could be questions and afterthoughts that may come as you go through our financial results in greater detail. Please feel free to reach out to Jigar or any one of us in the IR team, and we will be more than happy to share whatever we can share as responses to your queries and questions. Thank you very much once again for your support, and all the best as we move forward.
Thank you, members of the management. On behalf of National Securities Depository Limited, we conclude this conference. Thank you, everyone, for joining with us today, and you may now disconnect your lines. Thank you.