Q1 20/21

Jul 28, 2020

Ladies and gentlemen, good day, and welcome to the CDSN Limited Q1 FY 'twenty one Results Conference Call hosted by Axis Capital Limited. 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, of which could be construed as a forward looking statement, must be reviewed in conjunction with the risks that the company faces. Please note that this conference is being recorded. I now hand the conference over to Mr. Aditya Babil of Axis Capital. Thank you. And over to you, sir. Thank you, Ayesha. Hi, good morning. We've taken half of Axis Capital. A very warm welcome to the Q1 FY 'twenty one conference call of CDSL India Limited. Before we begin, we really hope that and your family stayed well in this time of pandemic. So we have the management of CDHL. It's represented by Mr. Nehal Vohra, Managing Director and CEO, Mr. Girish Ameysara, Chief Financial Officer Ms. Naina Ovelkar, COO Mr. Sunil Alvarez, Chief Operating Officer of CDFL Ventures Limited Mr. Swaroop Kumar Gauti, VP Mr. Nilesh Gittoor, EVT. Before we begin, let me just take this opportunity to congratulate the entire team of CDSL for the And now without further ado, Nehal sir, over to you. So I would like to wish everybody a very good morning. And thank you so much, Aditya, for the warm welcome and your compliments. First of all, I would just like to hope that all of you are safe and secure in these times. I welcome you all to CDSL's quarterly conference call for the quarter ended June 30, 2020, and I trust each one of you and your loved ones are safe in these hard times. I am joined on this call by other members of our management team, who will also address the questions later that you may have. Before we get into the details, I want to take a brief moment to place our appreciation and gratitude to all our employees and stakeholders, Because in these times, we have all kind of remained 1 and ensured that CDSL as Part of the depository services was designated as an essential service. And we are proud to inform that, that our operations have been running seamlessly across this entire time without any compromise on the health of our employees. In response to the COVID-nineteen situation, We have also created and launched various initiatives to promote our ART1 Nirbhar In terms of basically the ultimate customer being able to perform its functions on its own, so we have various platforms like Easy ECS. And I would urge all of you as well as all your well wishers, family members as well as people who you know to kind of use these platforms of CDSL so you can start doing things on your phone. In terms of the business highlights, In the last quarter, CDFL has observed a buoyant increase in the number of new behemat accounts being opened, and we would like to welcome the new investors into the capital ecosystem. During the last 3 months, the number of new active beneficial owner accounts with CDSL has increased about 20 lakhs, Taking the total number of active beneficiary accounts as on June 30, 2020, at INR 2.32 crores indicated a growth of around 7% to 8%. The comparative number of beneficiary owner accounts for the quarter ended June 30, 2019 was approximately L6 lakhs and Lakhs for the quarter ended March 31, 2020. As on June 30, 2020, GDSL has 5 97 Depository Participants, offering depository participant services from about 20,000 locations across the country, representing around 94.5% to 95% of the imports of the country. These depository comprise of clearing members, banks, custodians and non banking finance companies. CDSL has experienced growth in the number of companies, issuers admitted in DMAT from 541 in the FY 1999, 2000 when we started our operations To 14,018 around 14,000 companies in the F5 twenty nineteen-twenty twenty, which has seen very healthy growth. We have also initiated new services in line with the transformation requirements and the requirement of the current time to promote the digital initiatives of the government of India. In addition to our e voting services, We also offer services to hold any general meetings or video conference facilities to make AGM hassle free as to make AGMs basically a hassle free event for the shareholders and the company. We also provide email updation services to companies to update their shareholder database to ensure that the dissemination of communication to shareholders is valid In terms of the financial performance, we have seen a heavy growth in the quarter with year on year increase of 50 80 percent of our net profits, total income on consolidated basis for the quarter ended June 30 increased by about INR 12.58 crores, about 17% increase to basically INR 86 crores from INR 73 crores earlier. The net profit on tax on a consolidated basis for the quarter ended June 30 is at about INR46.72 crores compared to about INR27.9 crores in June 30, 2019. The total income on a stand alone basis for the quarter ended June 30, 20 increased by INR 15 crores, which is standing at around INR 67 crores from INR 52 crores earlier. The net profit after tax on a stand alone basis for the quarter ended June 30, 2020 is at about INR 37 crores compared to 20.3 crores for the quarter ended June 30, 2019. The growth is a result of the strong growth in our depository and the other businesses and also a decline in the overall costs as compared to last year, especially the employee costs as well as the other expenses. I'll request Srishunir Alvaras to give an update about our operations In our wholly owned subsidiary, CDL Ventures Limited, I will turn it over to you, Suneel. Good morning. I'm Sumeer Elvarez here, Chief Operating Officer of CBS Health Ventures Limited. I welcome you all to this call on CBS Health's quarterly results for the quarter ended June 30, 2020. Although this although during the lockdown, we had some impact in the verification process initially, You'll be happy to note that the operations have since been normalized once the lockdown has been lifted partially. In terms of the business highlights, CDL has had a very robust performance in line with CDSL's robust account opening performance, what we have seen. So far as KYC generation is concerned, In the quarter ended June 2020, we added 9.95 lakh KYC as KYC as compared to L4.68 lakh in the same quarter last year, which was a growth of 112%. We are also processing cKYC records and for entities who want to submit their KYC on the sales side And in this quarter, in the quarter ended June 2020, we processed 3.58 lakh record As compared to 1.9 lakh record last year, which was a growth of 87.79%. As far as the RCA business is concerned, there was a slight dip there in the sense. Though we had about 433 companies as of 31st March 2020, during this quarter, we could add only about 20 companies, primarily because many of the companies did not want to demag their security. And finally, so far, We are also doing this advanced monthly GYODRIGE integration, DigiPOP of record, where we were able to process again about 31,000 record as compared to 11,000 records in the same period last year, which again was a growth of 182%. Coming to the results, so far as the revenue from operations are concerned, we did INR 12.9 crores as compared to INR 17.7 crores in the same period last year. This was a dip of about INR 4.16 Scroll the 24%. This dip was slightly due to a onetime income which we received from PACL, The processing of PHL application forms last year of about INR 7 crores, That is INR 6.93 crores, which was a onetime income and it didn't come in this year. So effectively, if you take out the PSEL results, PSEL income, Obviously, the results would look different. The other income also jumped to INR 4.16 crores from INR 2.53 crores last year, It's a jump of 64.44 percent. Overall, the total income for this year, this year's quarter ended June was INR 17.07 crores as against INR 19.60 crores of last year. There is a slight dip of around 13%. The total expenses as This year was INR 6.41 crores as against INR 10.7 crores INR 10.75 crores of last year, which was a dip of almost 41% this year. The profit after tax was for this year was INR 10.65 crores, as against INR 8.85 crores from the previous year. That is a jump of almost 21%. And the post tax profits, the profit after tax for this financial year was INR8.5 crores as against INR6.53 crores for the previous year, which was a jump of 30%. I will now hand it over back to Aditya so that if there are any questions you'd like to Thank you. Yes, operator, can we start the Q and A session, please? Sure. The first question is from the line of Ritesh Chhedra from Ratinibati. Please go ahead. Yes. Sir, just a question on the cost base now. You could give some color on the cost base because last year, there were a lot of one offs. And this quarter, also because of COVID, we see some lower costs as well. So this about 20 6 odd crores of quarterly cost that we see ex of depreciation. What should be a better number that we should consider as a cost base? And I have one more question. If you could just help us with the absolute revenue breakup of this INR 65 crores of revenue for the quarter What is the INR 60 crores of revenue for the quarter last year? These two questions. Sure. We will provide you the details of Cost and revenue breakup. Basically, the cost compared to on a YOY basis compared to June 2020 compared to June 2019, The cost has decreased by almost INR 877 crores. This is slightly Sorry, like, so this has largely decreased because of what Sunil has mentioned of PACL project, which was there during last year, so basically there is there was a cost of 5.6 during last quarters, which is not bad this quarter. So that is the saving. And on account of salaries, the earlier year bonus positions, which have been reversed during this quarter, which has resulted into reversal of roughly 2 growth. And The increase which was given to the employees last year, it has impacted the overall accrual valuation, which was on higher side during last quarter, which is not there during this quarter. However, having said this, due to the reversal, the current quarter cost has been suppressed. So The cost will be recurring on quarterly basis. Now giving you the details of For absolute numbers of the income portion, total annual issuer income is closed as roughly INR 21 crores compared to last quarter's INR 19 crores. Transaction charge income has been closed at around INR 20.55 crores Again, last quarter's income of INR9.87 crores. Online data charges has closed at around INR9.85 INR5 crores against last quarter's income of INR7.63 crores. IPO corporate action has closed at INR5.06 crores to INR 5.31 crores. And the statement that we case statement that we issue is closed at around INR 2.95 crores Again, sir, INR 2.37 crores. So roughly, the income that I described right now covers almost 90% of our total operating income. I hope I answered your question. Yes. So just a clarification, transaction you said 20.5 lakhs? 20.55 lakhs Again, it's INR 9.87 crores. Perfect. And this cost now that we see at about, whatever, INR 25, 26 crores, 27 crores quarterly. Is it safe to annualize this cost? As I already told, in case of employee cost, we have certain reversals of earlier years. So a couple of Crores would be higher compared to what cost we reported this year because this quarter cost has impacted due to that reversal. And there will be no cost related to the project business which was there last year at least. Because last year, the project business cost and write offs All put together, more than fairly significant number. So is it safe to assume that that is not Yes. Currently, that project is not on. If there are any new project comes up during the future quarters, that we will impact. Thank you. Rupesh, we would request you to please come back in the question queue for any follow-up questions. The next question is from the line of Ashutosh Somani from JM Financials, please go ahead. My questions have been answered, but I have a request to make to the management. Sir, if you could include this revenue breakup as a part of your exchange filing, it will be a great thing to do. I believe this is a practice that was continued sometime in the past. And it was a good way to understand the result. So now this number is regularly shared in the call, but 2 days. So it takes that much time to understand the results. So if it is not too much of a hassle, can you please include it in your exchange filing? So we will surely take your feedback on record. We will have it examined and we will take appropriate action as being said on this. Thank you so much. Thanks. Thank you. The next question is from the line of Sidhant Kant from Goodwill. Please go ahead. Yes, hi. I had a question. According to the new semi rules, there'll be a lot of pledging revenue that we can see. So this is a new system. I think it will be difficult to predict and give any Guidance on future, we generally would like to restrict our queries and our replies to numbers which are as on March 31, 2020. This is a new system. We'll have to wait and watch how that will kind of panels in future. Okay, all right. Thank you. Thank you. The next question is from the line of Siddharth Rajpurovid from JHB Securities. Please go ahead. So that your line is in talk mode. You can go ahead, please. Hello? Am I audible? Yes, sir. Good morning, sir. Thank you for the opportunity. I'll ask 2 questions and then come back in the queue, sir. Sir, my first question is that the current income tax filing in India is close to 5.5 crores. We have reached more than INR 4 crores of DME account. Do you see any glass ceiling in coming few years for the new DME accounts? So, okay. And so first, I would request you to first ask Both your questions so that it can be combined if it can be combined. Yes, sir. And do you see Any hindrance in terms of maintaining our good margins operating margins that we have maintained over the years in the long run? Okay. So the reply to your first Question is that in terms of the growth of the fan as India's population grows and Especially the working population, we have a young population. So more and more people are going to be added to the income tax fold as we go forward. And that will obviously, people are looking at market driven instruments. So more and more people are wanting to invest their money through the financial markets, be it Mutual Funds or Digital Securities market on their own. I think the number of bank spends are far higher around INR 75 crores. So I think technically, As more and more awareness is growing, we would see that they could there would actually, they'll expect it to be a higher number of people who are expected to grow. And also the people who are in the system are going to trade more. So this is something which is function of what will happen in future. But I think what we are what is important to note, they are building the requisite building blocks to ensure that more and more people can safely come into the financial markets and trade seamlessly. I think that's our entire intent. In terms of the margins is a futuristic question. It's dependent on lot of factors. We'll have to see how it pans out. Our effort and endeavor is to ensure that our platforms remain safe, secure and convenient. And our focus is going to be more and more of the final people who are trading should be able to do it by themselves. So I think more and more people are going to do that. The safety and the security is something which we hope that they would be using the platform Recently, only as we go forward. Thank you, sir, and congratulations for good set of numbers. I'll come back in the queue, sir, for my question. Thank you so much. Thank you. The next question is from the line of Kunal Tanvi from Banyan Tree Advisors. Please go ahead. Hi, sir. Thanks for the opportunity and congratulations on the I was just going through the platform that we are working with KB for this flight creation. But I understand that It won't be feasible for me to give you the future in the pipeline. But what I was asking was How that platform would work and what would be the role of your depository and how would those So Ajay, this only will be charged by the deposit. Do you have anything to flavor in terms of how that platform would work and what would be the role of the deposit is? That is the first one. The second is, how what kind of traction we have seen in the CAGM? What will be our market share there and what will be every realization? Any color on that if you can for a while? So the first Your second question, I'll answer first. And the first question, I'll request that COO, Ms. Mena to answer that. So first I'll answer your second question. I think again that's a futuristic question. Our endeavor is to provide safe, secure and convenient platforms. Our endeavor is to have more and more distribution points within the country. We are around 94% to 95% of the PIN codes where The CDSL system is available. And I think the safety security of the platforms We'll really encourage more and more people to come on to our platform seamlessly. And that is our focus. Focus is not to drive in terms of the numbers. Our focus is to create a platform which remains safe and secure for the long period of time. So whatever people come in have a good user feel as a user and they continue to trade more and more onto our platforms. As regards the first question, I requested COO, Ms. Nena to answer the question on Slide 3. Hello. I understand that the question was with respect to the agents being handled By CDHL to them both in Blackstock? No, no, no. Mehmed's question was about the pledge and replay system as to what will be the role of that depository? What is the role of CDSN in the pledge replay system? Okay. So in this new system of pledge replace, The depositors play a vital role because the change is that whenever a client is setting up a request for margin pledge. At that time, an OTP will be sent by the deposit fee to the client. And unless the client authenticates, The plate will not go through. So now the authentication is being done by depositors and An opportunity is being given wherein after the client pledges per share for margin purpose with the Clearing member. The clearing member can replace it in favor of clearing corporation. So earlier the transfer to happen from the client account to the clearing member account. And after that, only those unencumbered shares would be placed by the clearing member in favor of PC. Instead of that, the client will be in a position to pledge in favor of clearing member And then the clearing member will be able to replace it. The client will have visibility of each pledge And how it has been replaced and what is the status of that replaced? So the depository system will provide all this information to the client as well as to the clearing member. So not a transferring fee will be brought in to the entire system while using the deposited system. And in terms of creating the pledge, positive would be charging up to the clearing number or the client? It will be a salvageable service. Okay. So you could see the circular which issued on the charges. We would not like to waste too much time on the operational details and go on to our website. We have issued the circular Thank you. Surandi, would you please come back in the question queue for any follow-up questions? The next question is from the line of Sanjay Singh from Pine Ridge Investments. Please go ahead. Yes. Hi. I will drop off in the queue. So you had mentioned the transaction revenues of INR10.55 crores from INR9.86 crores. Can you give me mention the other key revenue decline items also? I was just getting the call dropped off. I would just request a CFO, Mr. Girish Amasara to answer that question. Yes, I will go through once again. Annual issuer charges has increased closed at INR 20.76 crores compared to INR 19.23 crores. Transaction charges closed at INR 20.55 compared to INR 9.87 crores. Online data charges has closed at INR 9.85 crores compared to INR 7.64 crores. IPO corporate exchange income has closed at INR5.06 crores compared to INR5.31 crores And the cash statement charges has closed at INR2.96 crores compared to INR2.37 crores. Basically, this all income covers 90 Your online deductions are INR 9.85 crores versus? INR 7.63 crores. Okay. And sir, you also mentioned that there were some one off In employee cost, last year we had made certain bonus provisions And those has been reversed in this quarter because the payment was less compared to what we had provided for. And during last year same quarter, due to revision in the salaries, the actual valuation cost was higher compared to this year's structural relation cost. So these are 2 one of the costs which was there during last year and which are not featuring in this quarter. Having said this, the reversal has impacted the current year cost by INR 2 crores. Current quarter cost, right? Yes. Okay. Okay. And this online division is essentially with KYC charges? KYC, KYC, yes, yes. There is CDFL Ventures, Indaka. And what was the IPO revenue? IPO was 5.06 crore compared to 5.31 crores. Okay. Thank you very much. I'll come back to the question. Yes. Just before I go to the next question, just wanted to Clarify, I do want a clarification from Menon that charges are subject to getting approved by So it has yet not been issued on to our website. So I stand so as soon as the approval comes, that shall be issued on the The next question is from the line of Prakash Kapadia I had two questions. Congrats to the team for doing a wonderful job on the continuous gaining market share for demand accounts. If you could give some color, these So, Demat accounts are being done in the close tier 2 and tier 3 end. If I look at the cumulative base around 2.31 crore demat accounts at So how do we internally drag these Demat accounts in terms of activity? So we call these At your account, if there is a debit transaction once a year, once a quarter, how do we ensure more and more people Are happy with us. What initiatives we take? And secondly, on other income, what is the mark to market gain on the RUB 20.7 crores total other income? So on the first question, It will be difficult to give a complete picture on how what would be the demographic profile Because this is through the depository participants, which have offices, they do not have offices only in one location. In multiple locations. So from wherever it gets an important thing is that it's a fairly healthy mix of accounts being open in Tier 1, Tier 2, Tier 3 and Tier 4 cities also. About so This is something which we see. And what we have observed is around 70% to 72% of our transactions are coming from Tier 2, Tier 3 and Tier 4 So that is something. But again, this is not really an indicative of any future growth. This is what has happened in the past. The hope and wish is that as more and more people are going to transact, The building blocks have been created for people to do that. As regards to your second question, I'll request the CFO, Mr. Girish, to answer that. Yes. So the income that has increased during this quarter is largely on account of to market gain, which is roughly around 6 to 6.5 crores. If you recall, the RBI has reduced repo rates during this quarter up to a tune of 115 basis points, which has overall increase the closing NAV of majority of the skills. So roughly our yield this Quarter is around 12% compared to last year's yields of around 8.5%. I hope you answered the question. I'll join back with you. Thank you. Thank you. The next question is from the line of Abhijin Champar from Trustline DMS. Please go ahead. Thanks a lot for the opportunity and congratulations for good set of numbers. So what are the key reasons for Is data entry business degrowth of 24%, any break up for that? So I will just request Sunil Alvaris from CBL to answer that question. Yes. Hi. You have to understand one thing is that it was a one time business, okay? So far as the data entry was concerned, These are appointed to process refunds for a particular company by the regulator. So that onetime Collection of data happened last year, okay, for which we raised the base. And the expenditure also, we had booked it last year. So all of that happened last year. So that is why it does not reflect in this year's balance sheet. So how much of that constitutes for the last year Business? Sorry? In the Q1 FY 2020, so how much of this related to that business? Q1 FY 'twenty, the income was almost INR6.93 crores. Okay. Okay. So that was INR17.07 crores. Okay. Okay. Got it. Thank you. Thank you. The next question is from the line of Praveen Tolva from ICF Research. Please go ahead. Hello? Yes, my questions have been answered, but this one thing is added on implied calls. So, Harnay, yes, yes, you can go ahead, Girish. Okay. So, what I had explained earlier that the bonus provision that was made last Here, against that, we have made reduced payment. So whatever was the excess provision made during last year has been reversed in this quarter. So there would be bonus payments, but not to the tune of what we had paid during last year. So it's just like that installment in the 3 digit. It is a daily installment. No, no, no, no. What I I think you didn't understood. Suppose we make a certain amount of provision during last year and out of that if we consider to make payment of 50%. The balance remaining 50% would not be paid and it could be reversed. So on a continuous basis, the balance 50% may continue to be paid. I'm just giving an ethnical example to make you understand. Sure. So the employee cost in the next quarter will be in the Q1 of RMB12 to RMB13? Yes, possibly. Okay. No problem, Michel. Thank you. Thank you. The next question from the line of Ritin Jain from Investcor. Please go ahead. Yes. Am I audible? Hello? Yes, yes. Okay. My first question is on the annual issuer charges. So What would be the unreleased what would be the revenue contribution from the unlisted opportunity? And my second question was pertaining to this quarter. While you have clearly explained the year on year drop In expenses, if you could also explain the sequential movement in expenses. So employee benefit expenses up sequentially by 9% And other expenses is down sequentially by 31%. If you could also explain the reasons for that for this quarter, it will be useful. Thank you. I would, did you request CFO Girish to answer that? In case of employee cost, I have already explained a couple of times. You want me to again explain it? No, I'm saying sequential. So while you have explained year on year drop, I think sequentially, it has gone up by 9%. So I'm not sure if you're expecting that as well. So when you say sequentially, you are trying to compare March quarter with June 2020 quarter? That's right. So we had also factored in the Increment of roughly around 8% to 9% during this quarter. So you are saying that you have given wage hikes this quarter to all the employees? Yes. Okay, okay. That explains that. And then other expenses is down Q o Q quarter? Q Q? Yes. So in last quarter, when you compare March to June, last in March we had considered CSR contribution of last year and all the previous years put together which was around roughly around INR6 crores And we have taken one time legal provision of around INR 1.79 crores during March. So these 2 put together is the Main reason of reduction in March to June comparison. Understood. Understood. And my other question was revenue contribution from unlisted market. Nilesh, can you give the response please? Nilesh? Hello? Can you hear me? Yes, go ahead. Yes, hi. For Unlisted Companies, the contribution in this quarter is around 2% of annual issue charges as compared to approximately 10% last year, the corresponding quarter of previously. So you think 10% of INR 19.23 crores in 1Q 'twenty was from unlisted and this quarter it is only 2%? Yes. Because of lockdown, there have been fewer number of companies, understood companies admitted into the system. Okay. Okay. Okay. Understood. Thank you. The next question is from the line of Amit Chandra from HDFC Securities, please go ahead. Yes. Thanks for the opportunity, sir. So my first question is related to the consumption charges. So as we are seeing that most of the growth is being led by the provisioning the conversion charges, which is being up for the 3rd consecutive quarter. So I would like to understand a bit More in detail whether the conversion charges contribution has been coming from the Existing or the old accounts or from the newer accounts that we have added, say, in the last 6 months? Because the last 6 months, the account additions have also, I know, surged significantly and we have the end market share versus MSC also. So if you can provide some color between existing and the kind of net new accounts, so that it would be helpful to understand the profiling of the growth. And the second question would be on the KYC revenue. So as we have enabled the Aadhaar based So what added advantage you can have versus competition, I think because of this And we are actually waiting for some approvals to be done until this goes live. So what is the update there and what kind of competitive advantage we can have and what it can add value to the existing TPs? So that is the second question. And third question is on the annual issue charges, wherein you said that the market share is 30 hours and 70 for the completion. So how do you see that panning out? So it is going to remain in the same vein, but we are seeing Some question there in terms of gaining market share there also. Thank you. So I'll answer your first and third question. 2nd question, I'll ask Sunil to answer. The first question is about the mix between the new accounts and the existing accounts. I think it is it will not be easy to kind of segregate that way between that. I think what is an important data point to keep in mind is the cash market volumes on the exchanges has gone up significantly over the last year. The delivery base volume in terms of the absolute value has also gone And that is what Tantamounts to increase in transaction charges on the basically on the CDSL because that is what it creates In terms of how the how many transactions are coming through, I think it's a function of both. That one is that there is renewed participation from the existing. And that is also kind of really encouraging the newer investors to come in, in a very, very rapid phase. So I think In terms of the contribution, we are more concerned with our overall income going up rather than whether it's coming from new or old. But our endeavor is also that it makes it easy for more and more people to enter into a fold and have a convenient secured platform to trade on them. So I think that is our real focus out here. In terms of your third question, in terms of basically the unlisted companies, our hope and endeavor is and we are putting in place our renewed effort to improve our share in terms of how many companies come on to the CDSL fold. It's again a futuristic question whether that will succeed or not. But Basically, the effort of the management is going to be to ensure that more and more companies come in, making the platform easy for the companies also to come on board. And with that hope, with more and more companies seeing the success, So I think our share also should increase. As regard to your second question, I'll ask Sanjeev to answer that. Thanks, Nir. I'd also like to add on the transaction When you talk about old and new accounts, typically when a new account is opened, it does take some time to start transacting. So like, you know, like we said, it's a mix of both the old and new accounts. So you cannot really attribute it to the new accounts only or to the old accounts. And if you also see that the number of transactions also are at a record high. So it has been a mix of both accounts. And typically, each of these accounts takes So some time, cooling time before they actually start conducting. Prior to the lockdown, this used to be about months with people at home and opening accounts, I think maybe this period will have come down. But net net, I mean, the fact remains that it is a mix of both the old and the new accounts. Coming to your second question on the KYC revenue order, I would add on this, Do KYC have a positive impact? Definitely, it will have a positive impact because it would improve the way people actually do KYC today. Today, we have offline adargos to KYC or you have to upload, scan and Either through an OTP or a biometric, you can do a CIC. And depending on what model you follow, so if you're following an assisted model as a GP, then you can Actually, take a tab to the investor, take it biometrics and do a KYC there itself. Alternatively, you You know, post the U2IC on your website and with on the website itself. The current status is that The approvals are pending with the UIDX. So none of the MII has got any approval as yet. So once that approval is the same. They'll definitely boost the account opening even more because Sabia issued a circular on April 24 for online devices. As well as another point I'd like to make here, we've also received a eSign registration from the CCO. So as per the service sector, all online applications have to be e signed. Further, we have also applied to UIDAI to allow us to do online Adar based e device online Adar based e sign, okay? So that approval too has been given by you again. So I think we are very satisfied that once all the approvals are in place, Online account opening will definitely help. And we have also developed a product which will help both the mid size, I realized, the smaller DPs to open online account in case they are unable to invest in This offer for whatever reason. So we will be giving them that fees which they can plug into their website and Thank you. Amit, we would request you to please come back in the question queue for any follow-up questions. The next question is from the line of Alok Sir, I have a few questions, some of which are data keeping for media, I'll just take them separately. But when I look at your employee expenses line item on a stand alone basis and again then compare that to a consolidated basis, On the standalone business, these numbers are up something like 20% Q o Q. You've talked about 8% to 9% wage size, which is kind of it's both in each of those line items. But what explains the difference here? That's my first question. And then when I again look at employee expenses on a consolidated basis and at this end for the one off that you talked about, the INR 2 crores of bonuses versus and actual valuation related line item, it shows a 16% drop on a Y o Y basis or on a QoQ. So What is it? I mean, is it that we have had some element of employee count reduction or something where have been some element of uncertainty, reduction in salaries. How do we read this number, sir? So before I ask Girish to answer on the absolute numbers, on a conceptual basis, you need to understand that TVSL has now have a full management team, including the MD and CEO. So as regards the calls of the previous MB's terms coming to an end and to senior employees, their terms coming to an end, the CTO and the CFO. So that is something which is which has really panned out what you are talking about. And in terms of the numbers, I'm requesting Girish to answer that. [SPEAKER SRINIVASAN VENKATAKRISHNAN:] Sure. So As you rightly said, on a standalone basis, employee cost has increased by 23% compared to When June is compared to March and if you compare June to June, the cost is reduced by 34% for the reasons I had explained earlier. Now, our MDS already explained you the reasons. Do you want me to again repeat those things? Hello? Hello? [SPEAKER UNIDENTIFIED COMPANY REPRESENTATIVE:] Hello? Hello? Yes, sir. No, not the reason for YY decrease. There's a few things here. Hello? Sir, is my voice audible? Yes. Now it is audible. Okay. No, I was just trying to understand the arguments which you were Trying to put across, we need to get the reasoning for the Y o Y change. So I think it is basically the similar reasons in terms of what you have said and the journey management team, which I have already replied to. Thank you. I'll now take a question for any follow-up questions. The next question is from the line of Ramkrishnan Lee from Equity Energy. Please go ahead. Yes. Good afternoon, sir. Good afternoon, sir. Good Sir, what is the incremental market share on the Market share of incremental DC account opening and top 5 DCs will be contributing more percentage. So the incremental numbers is basically, during the quarter, it's about 85%. Where we've got the new numbers, so that's that. As regards to top 5 DPs, I think that The particular information we don't put out yet in the public domain as to what is their contribution. So that is something which we will have for you as a consolidated basis. We will I don't think we were able to give you that number. Thank you. The next question is from the line of Sarojis Sohra I have two questions. The first question is on capital allocation. So we have more than 84% of cash and investments of total assets on our book. So what is your policy regarding dividend payout? And that is first question. And the second question is regarding what is our market share In any AGM, that could be started recently. So on the first, we have answered that We have a dividend policy. I will ask actually the CFO to answer this question on the dividend policy. So can you answer that, Girish? Yes. I think basically we have a dividend policy of making payout of in earlier regime it was around 40% including the dividend distribution tax. So considering this year there is no dividend distribution tax, we have We will continue to make those kind of payments to the shareholders as a dividend. Okay. And sir, do you have any regulatory requirements regarding the certain cash percentage that you should have on your balance sheet or something like that? So there is a minimum requirement with Sebi as prescribed on how many depositories supposed to have. We are well over that. But in these times, it's important to have the strength of the balance sheet to continue. So whilst we as Girish mentioned, we have a robust policy of dividend payout of the operation profit. But at the same time, it's important to build the balance sheet of CDSM Because as it grows, it shows the financial strength of the company to ensure that our basically our volumes, etcetera, continue to grow. Thank you. The next question is from the line of Viraj from Banyanji Advisors. Please go ahead. The next question is from the line of Puneet Sami from Baiduji Advisors. Please go ahead. Hi. Thanks for the opportunity again, sir. So my question was now on the cost structure. So post COVID, So are we looking at any cost reduction measures in terms of so the reason I have your question is Across the board, we are seeing a lot of companies talking about getting rationalized in terms of cost and taking this time also into great And second question was on our philosophy at management team in terms of new projects. At what extent we expect to put money behind a new project because last year around, right, we lost the land project. Wanted to understand on an indicative basis what kind of investment we did in that project and within 2.5. So do we have any benchmarks here in terms of going for a new project? So these are the 2 decisions that I want to finish on. So I think I can answer both the questions together. I think the philosophy is that we are a market infrastructure institution. So YLC remain a listed company. It's also a market infrastructure institution. It's a very regulation driven business, Right from the areas which we can go into to the charges which we can charge is all driven by rules and regulations described. So there are few players, but I think the important thing is that whilst A normal company can reduce the cost significantly. We also create a market infrastructure platform. And therefore, certain expenses are required to be incurred under whatever circumstances to ensure that the linkage to all the relevant market continue to remain under so our intent, as you can see from here has been that even during these 3 months, when there's a national lockdown, the important thing is that our platforms continue to run without any kind of issue. And that is, in my opinion, the success and basically the expectation which SEBI as a government ministry, etcetera, have from us because we're creating the infrastructure for the market. As regards to new projects is something, which we will be again be driven by water rules permit to the extent that permit. And whilst what is commission driven, We've also then seen whether it is financially viable or not. So there are various kinds of other kinds of the So whenever we explore a new project, we look at the potential, what will be the financial things. But more importantly, it is It's a permission driven business. So whatever the regulator permits us or the ministry permits us, Thank you. The next question is from the line of Sanjay Singh from Bank Ridge Investments. Please go ahead. Yes. So the insurance depository, we have created a framework. And Obviously, during the lockdown, it is not compulsory as of now to have a DMEK insurance policy. But I think with the lockdown, lot more insurance companies are feeling the need of moving towards that. So we are hopeful. We continue to basically remain creating the platform. We are creating the requisite linkages with the insurance company and with the hope that things would change for the better. We are seeing some amount of basically the inquiries coming from the insurance companies about what is the platform and we are seeing what our systems are. And hopefully, all of that would translate into a new business for us. As of now, there is not any meaningful revenue, right? Yes. As of now, it is not a meaningful debt. That's right. And what was the revenue this quarter from all this eVTAS and eOGM and all this e voting new business in which you have? So I would just request the CFO, Girish, to answer that question. So, e voting business, we have income of roughly Lakhs, compared to Lakhs of last year. Thank you. The last question is from the line of Utkash Solapurwala from ZAMUR Capital. Please go ahead. Hello. Good afternoon, sir. Good afternoon. Sir, can you provide the performance update of last 3 months of commodity repository? I would just request the CFO, Girish, to disclose the outline In commodity repository, the income that was earned in June quarter was roughly around GBP 10 lakhs compared to last quarter income of around GBP 77 lakhs. What net to this done for year on year? Quarter on quarter, quarter on quarter. And basically, The charges were revised with respect to the custody charges. Okay. Thank you. Thank you. I would now like to hand the conference over to Mr. Adi Thabhu for closing comments. I just want to thank everyone for taking the time out and attending this call. A special thanks to the entire team of CDSL for patiently answering your question. Nehal, sir, I'll hand the floor back to you, just in case you have some closing remarks. No, I think, 1st of all, I'd like to thank Grille Access for creating, and I would like to thank really all the people who have come in large numbers for the Our endeavor and effort is to ensure that our systems run seamlessly. And it creates a convenient and secure platform for the entire securities markets and more important the financial markets. So we are working very, very hard to ensure that it becomes a technology based depository. And our focus is also going to be, as I stated in my opening remarks, is to creating the final customer, the investor should be able to transact on its own without the help of anyone else. So you want to start creating more and more such systems where people can start doing things on their own without the help of others. With that, I would like to that's my closing question. Thank you. Thank you. On behalf of Axis Capital, that concludes