Q2 19/20

Oct 22, 2019

Quarterly report

Ladies and gentlemen, good day, and welcome to the Central Depositary Service India Limited Q2 FY 2020 Investor Conference Call hosted by Axis Capital Limited. Please note that CDSL does not provide specific revenue or earnings guidance. Call. Anything said on this call, which reflects CDSL's outlook for the future or which could be construed as a forward looking statement must be reviewed in conjunction with the risk that the company faces. 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 the conference call, please signal an operator by pressing star then 0 on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Aditya Bagan from Access Capital. Thank you, and over to you, sir. Thank you, Nirav. Good afternoon, ladies and gentlemen, and a warm welcome to the Q2 FY 2020 Earnings Call of CDSL Limited. From the management today, we have Mr. Nehal Vohra, Managing Director and CEO Mr. Bharat Sheth, CFO Mr. Sunil Alvaris, COO, CDSL Ventures Mr. Garang Shah, Vice President and Mr. Nilesh Kattoor, Assistant Vice President. I'll hand over the call to Mr. Nehal Gora for his opening remarks, post which we will open the floor for Q and A. Over to you, sir. So first of all, I would like to welcome all of you a very good afternoon. This is Nehal Ghora. I'm the MD and CEO of CDSL. I've just to join CDSS on the 24th September. So it's been around 3 weeks since I've taken over. I welcome you all to the quarterly conference call for discussing the standalone and consolidated results for the CDSL Group for the quarter ended 30th September 2019. So as you know that due to the overall slowdown and various in uncertainties in the Indian economy, global factors like trade war between U. S. And China, oil prices, etcetera. That Indian stock markets were in turmoil, which resulted in not many IPOs hitting the market and while the overall sentiment has been muted. This has resulted in the CDSL top line showing a 10% downtrend quarter on quarter and a marginal downtrend on a year on year basis. Despite the slowdown in the economy, CDSL has been able to maintain a flat bottom line. CDFL continues to have a healthy operating profit margin of 47% on a consolidated basis and 46% on a stand alone basis. Conference call. The price to earnings ratio is about 1.919. During the QE September 2019, CDSL added around 8 lakh beneficiary ownership accounts as compared to 6.37 lakhs in the previous quarter. CDSL now has an incremental market share of around 74% up to August 2019. In the case of CDSL Ventures, CDL, that KRA performance is linked to the stock market, which has also remained muted in the quarter which has ended. However, compared to that, we have was down INR 1.99 crores KYC records as on September 2019, while it was the corresponding number in June 2019 was INR 1.93 crores. CDSL Insurance Repository has crossed 5.37 lakh e insurance accounts at about 2.73 lakh policies. CDSL Commodity Repository, CCRL is also making steady progress with around 1,000 plus registered warehouse service providers, of about 1200 clients as on September 30, 2019. I request my colleague, Mr. Bharat Sheth, CFO, to give a brief on the financial performance. Good afternoon, everyone. The numbers take up as follows: 1st, consolidated results on Q on Q basis quarter on quarter basis and then year on year basis. Operational income for the quarter ended September 2019 was INR 53 crores against INR58 crores for quarter ended June 2019 that is down by 10% whereas other income is up by 11% from INR 15.02 crores to INR 16.68 crores. So total income overall down by 6% from INR73.42 crores to INR69.35 crores. Whereas my total expense is down 19% that is from INR38.44 crores to INR31.13 crores, mainly due to employee cost down by 21%, system maintenance up by 8% and other expenses down by 27%, mainly due to lower incremental expenditure on government projects. So overall profit after tax is up by 4% that is from INR 27.91 crores to INR 29.05 crores. Now major head of operational income on quarter on quarter basis, annual issue charges from INR 19.23 crores to INR 19.18 crores that is hardly any change, whereas transaction charges down by 7% from INR 9.86 crores to INR 9.16 crores. Consolidated account statement charges down by 14% from INR2.37 crores to INR2.03 crores. IPO corporate expense charges down by 9% that is R5.32 close to R4.85. Online data charges that is KYC up by 6% from INR 7.63 crores to INR 8.11 crores and government projects down by 65% on quarter on quarter basis that is INR 6.94 crores to INR 2.46 crores. Whereas on consolidated basis on year on year basis that is quarter ended September 2019 to quarter ended September 2018. Down operational income down by 2% that is from INR53.66 crores to INR52.66 crores. Other income up by 71 percent that is from INR 9.79 crores to INR 16.69 crores due to higher mark to market gain and IT refund of INR 2.2 crores received. For total income up by 63 up by 9% that is from INR 63.46 crores to INR 69.35 crores. Whereas total expenses up by 35% that is INR 23 crores to INR 31 crores, was up 35% mainly due to increase in employee cost salary revision by 35% to bring the salary levels to market levels and corresponding rechete and live actuarial provisions and other expenses increased by 49% mainly due to expected credit loss provision that is provision for doubtful debts of RMB2.40 million. So my profit after tax down by 4% that is from 30 point INR 15 crores to INR 29.06 crores. Major head of operational income that is annual issuer charges from September quarter ended September 2018, INR 15.96 crores. It went up to INR 19.18 crores that is up by 20% whereas transaction charges down by 11% because of bear market conditions INR10.26 crores to INR9.16 crores. Whereas consolidated account statement charges up by 13% that is INR 1.8 crores to INR 2.02 crores. IPO corporate exchange charges because of market condition less number of IPOs down by 21% that is 6.15 crores to 4.85 crores. And online data charges down that is for KYC, INR10.17 crores to INR8.11 crores and government project for quarter ended September 2019 up by INR2.45 against is up by 100%. Now on standalone basis that is quarter on quarter quarter ended September 2019 versus quarter ended June 2019. There are hardly any change in operational income that is INR 40.53 crores in June 2019 versus INR 40.59 crores in September 2019. Other income is 6% up due to mark to market gain that is INR 11.31 crores to INR 11.98 crores. That is total income up marginally by 1% hardly any change that is INR51.85 crores to INR52.57 crores. Whereas total expenses down 10% mainly due to employee cost down by 23%, system maintenance up by 6%, that is INR 26.84 crores to INR 24.10 crores. And profit after tax up by INR 20.35 crores to INR 21.95 crores. Major head of operational income, annual issuer charges on quarter on quarter basis that is INR 19.23 crores to INR 19.19, hardly any change transaction charges down by 7% that is INR 9.87 crores to INR 9.16 crores. Case charge is down by 14% that is INR 2.37 crores to INR 2.02 crores, whereas IPO corporate exchange charges are INR 5 point of INR 32 crores to 4.84, that is down by 9%. Whereas on year on year basis, that quarter ended September 2019 to quarter ended September 2018. Operational income hardly any difference that is down by 1 that is INR 40.98 crores to INR 40.59 crores whereas other income up 60 6% due to interest on IT refund and higher mark to market gain that is from INR 7.2 crores to INR 11.98 crores. And total income up by 9% that is INR48.2 crores to INR52.5 crores. Whereas my total expense is up 30% mainly due to increase in employee cost by 32% and other expenses 51% increase in expected credit close that is provision for doubtful debts, it was not there last time that is INR 2.43 crores. That is from INR 18.60 crores to INR 24.10 crores. So profit after tax down by 1% that is INR 22.09 INR2.09 to INR21.95 crores. Major head of operational income that is annual charges, annual receiver charges INR 15.95 crores to INR 19.18 that is up by 20%. Transaction charges down 11% due to market that is INR 10.26 crores to INR 9.16 crores. Consolidated account statement charges from INR 1.80 crores to 2.02 up by 13% and IPO Corporate Action down by 21% that is RUB6.15 crore to RUB4.85 crore. Session. With this, I leave the floor open for questions and answers. Thank you very much. We will now begin the question and answer session. Participants are requested to use handsets while asking your question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. Session. The first question is from the line of Prakash Kapadia from Anwidd Portfolio Management Service. Please go ahead. Thanks for taking my question. I had two questions. If I look at the first half employee cost, they are up 56%. So Is there I think last quarter you had mentioned some impact of gratuity and annuity. So is that continuing in the current quarter also? And For H2 basis, what is the trend in employee cost? How should we read this? Will it be more like a INR 12, INR 13 crores kind of Ranve, do we annualize it, so it will be more like INR 40, INR 42 crores or it will be more like INR 50 crores on the employee cost front? Yes. Hello, Mr. Prakash. If you see, last quarter also I have told that impact of 32% increase that is 25% plus 21% annual increment would be on 1st quarter more because of actuarial gain, actual liability as well as leave and cashment and all. So major impact would come on that quarter only. So if you see my INR8.37 means it was there INR 14.27 crores in quarter ended June 2019, it went down to 11.33%. That is down by 21% because of this actuarial liability as well as this. So it won't be there on what we call on quarter on quarter basis Because whatever impact was there is on 30 plus March 2019 on which we have provided on Q1 only. So incremental only would be the quarter on quarter basis. So this will be more like this run rate rather than what we've seen. Yes. And if I look at CDSL Ventures, the revenue reported in the segment revenue, revenues have de grown for us on a year on year basis. How do I look at this? Because at a time when Sleep accounts are growing, flows are steady. So is there some change in pricing? Is there some market share change? Or You know the segment revenue includes other income and other income is lesser in this segment because on a year on year basis, If I look at that segment, revenues have actually de grown from 138,000,000 to 130,000,000. Yes. This is because mainly because of other project that government project what we took it. If you see quarter for 2019, March 2019 quarter, there other income means other project income was around INR 2.5 crore. In June 2019, it was around INR 9 crores and in this quarter INR 2.45 crores mainly due to debt. That is a one off project is there. Okay. Okay. Q1, you said it was around INR 99 crores. Yes. Last year, what was it? INR 2.5 crores around. Okay. Last quarter, quarter ended March 2019. Yes, I was looking Bharat by Mr. Kapadia, sorry to interrupt you. You're not audible. Can Please speak about last time. I was looking Bharat by on a year on year basis where I'm comparing September last year versus September this year where it says 138,000,000 to 130,000,000, where data entry and storage has decreased from 138,000,000 to 130,000,000. So I was trying to understand that. Not on a sequential basis where you mentioned the government project and that contribution to into revenues has fallen, so revenues are down sequentially from INR 70 crores to INR 30. The number of KYCs processed by CBL as compared to last half year has gone up, but the number of fetches, okay, where we also get some revenue has gone down. That is primarily because last year, Sebby had mandated that all AMCs were not fetch certain KYCs. They had to fetch the KYC otherwise the distributor commissions would not be paid. So because of that many of the AMCs had a one time fetch So that had boosted up the number last year. Okay. Okay. So Suneel, the way to understand this is that is more of a one time listing, which was there in the base last year and there is no change in market share or pricing in terms of our KYC business. Yes. But there are 2 things to it. As compared to last year, we have processed more KYCs this year. That is new KYCs into the system. But that new KYC has to give us better pricing, right? No, but what has happened is correspondingly the fetches have gone down. So that has reduced the income. Conference call. Understood. And the last question from my side is, is there clarity You know the academic depository pricing because government was to revert and we were to start billing. So any update on that? We are in discussion with the MHRD. They have formed a committee and they would be deciding on the pricing. That is the latest what we have. Thanks. I'll come back if I have more questions. Thank you. Thank you very much. The next question is from the line of Anand Bounani from Unifi Capital Private Limited. Please go ahead. I have 3 questions. The first question is on the coupon for growth provision for doubtful debt. So can you elaborate on it? Like is it some kind of investments that have gone bad? Yes. Dan? Yes. So if you can I mean the questions are unrelated, so I want to go one by one? Okay. About doubtful debts that is on annual issuer charges. Generally, we'll be able to recover around 92% to 93%, 7% to 8%, we have to provide for doubtful debts or bad debts. So Generally, we were doing in 3rd or Q4, but this year auditor told us that you have to prorated for all 4 quarters. So because of that, if you compare with 6 months ended September 2018 versus September 2019, major cost of that 4 crores total what we have provided. Okay. And similar 4 crores can be expected in the H2? That would be around INR 7.5 crores to INR 8 crores. Sure. And sir, if I were to look at segment asset and liabilities. For repository, there has been a fall in segment assets. And for depository activity, there has been rise in segment liability. So if you can help us understand why is it so? No, segment, assets and liabilities. So if you have to see, for repository activity, It has fallen from INR55.6 million to INR 32 crore. No, that is because of if you see that is segment SaaS. That is because of new assets what we bought it and there is not major changes are there, Coric. No, but it has fallen by INR 23 crores. So why would it fall by INR 23 crores in 6 months, depository assets? Okay. I will get back to you on this question. And similarly, if you are to see depository liabilities, they have risen by close to INR46 crores. So why would again, why would you write there INR46 crores in the span of 6 months? No, no. It is the for annual income, we are transferring we are allocating on a pro rata basis. So annual income is suppose my INR 80 crores is there, then I can book it INR 40 crores and income received in advance will come to INR 40 crores. So it will come under liability Like that. Okay. Okay. So it's an earned revenue and hence the liability? Yes, yes, like that on that Yes. And sir, you gave out certain details in terms of numbers for our revenues. I just wanted to check if we received a presentation or the numbers given around you on the phone call. Have you received a presentation in general to the shareholder? Not yet. So on a small call basis also we can give you. Just a modest number to say from us that the numbers that you give are very important in terms of understanding the business. If you were to give us a in the presentation beforehand, the discussion would be a lot more detailed around the numbers. Otherwise, The numbers that you throw up initially, then we have follow-up questions. We have emailed you. So definitely, I'll just consider that. I think we will So we will surely take this as a feedback and from next quarter call onwards, we will do that. Sure. And lastly, we spoke about the environment being subdued. So is it fair to assume that the environment continues to be is good. And in terms of next 6 months as well, we might not see any deviation upside or downside in our revenues and profitability? That's a very difficult question to predict. It's like predicting whether the market is going to go up or down tomorrow. It's a function of market. We are a market infrastructure institution. Our core business is to provide requisite infrastructure for the securities market. And we are a function of for ensuring that the services are readily available and we have as many depository participants which has grown and have been steadily growing. Whether that will lead to further transactions is a function of markets, which is a collective response of the entire market and difficult to predict. Sure. But my question was more of like do we have any specific revenue streams, for example, the depository business for MHRD. Anything similar which can be commercialized this year and you might Any revenue from that? Any potential growth from those set of newer ventures? So I think, Debbie has been giving out lot of proposes for new products, new kind of asset classes. And there is a general push on the digital side. So obviously, the importance of the depository services are going to grow as and when as we move forward. But it will be difficult to categorize quarter wise in terms of revenue, but the overall trend is moving towards more assets moving from the physical mode to the digital world. And therefore, the importance of the depository services are going to grow as time passes. Okay. Thank you, sir. I'll come back in the queue. Thank you very much. The next question is from the line of Hardi Shah from Reliance Securities Limited. Please go ahead. Yes. Thank you for the opportunity. I just wanted to get a sense, I mean, if we can get an idea of the number of unlisted companies now that are there in your full. I think last quarter was about 2,000, 2,000 or somewhere in that range and the revenue that you have essentially earned from that incremental or unlisted companies? So as on date, as on 30 September, There are 2,530 unlisted companies under our fold. Okay. So we are almost 500 in this quarter? Yes. 463 what we had added. Right. And what was the revenue that you earned in this quarter? Yes, that is It would be around L57, 32,000. Okay. It's 57 lakhs in this spot. Okay, great. And any update on the NAD, NASDAQ, carried? So I think from now on, you can charge from this quarter onwards, right? So if you could give any updates on that front, how is that progressing? Yes, we have been discussing with MHIT with regard to the charges because we need the approval before we start charging. And the latest is that they have formed a committee And based on what is going to be our charges, they would be most likely giving a grant to both the deposit Okay, fair enough. And Homi are now in panel with you. I think last quarter was about 520 or something, is that right, We have 541 universities signed an agreement with us. Okay, okay. Thank you very much. I'll come back if I have any further queries. Thank you. Thank you very much. Your next question is from the line of Iyash Neerodkar from PPFAS Mutual Fund. Please go ahead. Hi, good afternoon. Good afternoon. So I have 3 questions basically and these are on different topics. So I'll just go 1 by 1. The first thing is in your financial statements for this quarter, I read something about India 116 being implemented. So what is it regarding? That is about the lease rental what we are saying on that basis. That is we are having a lease agreement with Reliance. That is a major one. So what is this regarding, Reece Lental? That is for our Doctor site. Okay. And then the servers are posted. So how much are these expenses with the rentals which are being paid? But it is not material because they are providing services to us. So we are evaluating it. Okay. Call. That's why you mentioned in notes to accounts that we are evaluating it. Okay. Among the leads as such because bundled services they are providing. All right. The second question which I had was on the recent notification which came out about the corporate taxes. So what impact would it have for your company and sort of if you could provide effective tax rate if you are going to utilize this benefit? Correct. At present, we are in 25% bracket because less than INR250 So for this quarter and next quarter, we are going to continue with it because as on 31st March 2019, Med credit is available to us. If we shift to 22% then it won't be available. So we are evaluating it. And later on by March, We are going to decide whether to go for 22% bracket or this bracket. So overall effective tax rate comes to 22% to us on consolidated basis. So as of now, you're talking about are you telling the MAC credit? Yes, yes. So you all are currently indifferent as to whether go for the current corporate tax rates or continue with the same? Correct, correct. But net credit, If I won't travel, then I can't go to 22% I think. Okay. And just last question. So you all had for the previous two quarters the government project. So last quarter, you all booked somewhere around INR 9 crores. This quarter, you all booked around INR 2.5 crores. So excluding that, What is the operating revenue? Excluding that, in CDSL Venture, what do you want to say? No, no, no, not CDSL Ventures. Overall, I'm talking about the consolidator excluding the government project. You have to remove 11 crores and total 6.5 crores you have to remove. So overall, My profit is down by INR 4 crores on a consolidated basis. The profit is down by INR 4 crores, I think. On this government project, my net profit is around gross profit would be around INR 4 crores. Okay. So my on consolidated basis, my profit down by that is I'm talking of profit before tax down by INR 4 crores. Okay. All right. Thanks a lot. Thank you very much. The next question is from the line of Chetan Damania from Correct Securities. Please go ahead. Good afternoon. So I suggest going back to what you said that In this financial year, though we have added number of more KRAs, the fetch on I mean the realized, the fetch was much lesser compared to the previous year, right? Yes, right. Sir, but if I'm looking at the previous quarter where we had INR 1.9 INR 3 crores of KYC Records, revenue was from data online and storage was to the tune of INR 171, INR 17 crores, which has declined to almost INR 13 code. So what was the reason for the sequential decline despite 6 lakhs increase in the records? That is mainly due to government projects. If you see in quarter 1, 2019, I mean this June 2019, I see My income from this government project is around INR 6 crores. It went down to INR 2.45 crores. So that is a major difference of INR 4 crores. Okay. So sir, do you think that our government project will still continue or the project is almost over? We've got an extension for 1 more year. So you've got an extension for 1 more year? That's right. And so what is the cost pertaining to this project? Because last quarter, we had a significant cost due to this and because of this, our other expenses have also gone up. Correct. So how was the situation in the Q2? The first phase got over income we have booked and expenses also we have booked. Yes. So now nothing left for first phase of the project. Okay. Since 1st month start, then income and expenses will come in feature. Okay. And secondly, can you help us with the e voting revenue for the 2nd quarter? You're working, yes, INR 2.48 lakhs for the 2nd quarter. 2 crores 48 lags. Okay, sir. Thank you. Thank you. Thank you very much. Next question is from the line of Amit Chandra from HDFC Securities. Please go ahead. Yes, hello. So thanks for the opportunity. So I would like to understand on the annual issue for charges. So we have been saying that the companies that has been added has been slowing down in the last two quarters. And now we are at a rate of 150 companies per month. So how do you see this panning out whether it's an opportunity that was there initially and now it's eventually like fading away and or you see like more and more companies approaching because If I see in terms of the competition, they have been adding on a steady basis. So your views on that. There also decline is there, but Understood company, that is but overall, if you see from 1st October 2018 to 31st September, around 2,530 companies what we have added, it comes to on an average basis 2 10 companies. As you say rightly that in quarter, it has come down from 200 to 154. But our endeavor is to because it is not yet compulsory. Whenever transaction takes place, then only so it is not mandatory. So, until it becomes mandatory then, but our marketing efforts are going on. Yes. So my next question is on that, That last quarter you mentioned that you are providing some kind of commission to the RTA for bringing the company to CDSL. So what's the progress on that? Are we spending aggressively on that or no? No, we have started from 1st August, 1st September. We already started That referral fee is what we are increasing. We are also trying to enhance the system so that digitization takes place and We are starting to implement that. Okay. And sir, on the revenues earned from the unlisted companies, Last quarter, it was around 15,000, but in this quarter, it's coming down at 11,500. There has been a drop. So has Has there been a change in the fees that you're charging? No, nothing. Not changed. But on question, basically. Yes. But when the admission of company success, we charge them on pro data basis, the annual issue fees for that particular year. Of 2. Understood, understood. Thank you. And sir, my last question would be on the government project. You mentioned that you have issued the extension, but you mentioned that there were around 4 crore accounts that has to be verified. So how we are placed there and how can we like project the revenues from it because it's very lumpy in nature? See, there are 4.5 crore investors, but when the scheme was open for refund, about 1.5 crore investors have applied. So that is the status right now. And the scheme was supposed to have 2 phases, Phase A and Phase B, okay. And we have completed Phase A and the regulator will have to take a call on safety whether they want to implement it or not. So that's the status. Okay, sir. And sir, lastly on the opportunities in terms of the National Academy of Depository and the e warehouse receipts opportunity. So the progress on that has been pretty slow. So are we seeing any kind of pickup there in terms of NAD and e warehouse receipts? If you can elaborate that on how we are approaching that? If you see in terms of number of records on the lag, we have crossed about INR 2 crores, INR 2 crores 30 lakhs. And even the number of student registered is going up by the day. So it is just a function for MHRD to make it mandatory for all universities and students and then you can really see they are taking off. Okay. So as of now, we're not charging anything. So you said that earlier you said that charging can start by September end. So any update on that? Yes. As per the agreement, we were supposed to charge post September 2019. But After discussions with MHRD and the UGC, they are not very keen that the universities and students we charge and at best they are thinking of giving us a grant so that the project continues in its current form. Okay, sir. Thanks for the question. Thank you very much. Next question is from the line of Pavan Kumar from Ratan Thara Capital Partners. Please go ahead. Sir, So you mentioned about around INR2.5 crores of revenues from the government for this particular quarter. So what are the expense pertaining to that? And number 2, so since you have you are also mentioning about an extension in this project. So how would the revenues play out, I mean, from this particular project over next 1 year? The expenses pertains to government projects for this quarter around Lakhish. Lakhs. Lakhs. Yes. Okay. And do we expect this run rate to continue going forward Every quarter from now on? See Phase 1 is already completed, so for which we have already booked the income as well as expenses. Once Phase 2 will start, then further income and expenses will come into fruition. Okay. But overall, what would be the potential of this revenue potential of this project from the next 1 year? Is difficult to predict actually because we do not know whether the window will be open again for investors to Apply for a refund. So it all depends on that. Okay, sir. If given the window didn't open again, Then what would be the potential? No, we cannot clearly predict anything on that. Okay, Okay. On the other expenses part of it, I'm taking the employee expenses off, But should the Q2 other expenses part of it when you deduct the employee expenses whatever, Is that going to be a steady run rate from now on Q3 and Q4? Yes. It will be on a steady. Okay, okay, okay. Okay, fine. Thank you very much. Next question is from the line of Rud Balakrishnan from Widhi Capital Investment Advisors. Please go ahead. Hello? Hello? Yes. Good afternoon, sir. Sir, I had 3 or 4 questions. So, sir, in terms of our annual issued charges, if I I get the number right. So it's around INR 19 crores and it has grown at a very good rate this quarter on a Y o Y basis. So what is driving this growth even last year the growth was quite good. So if you can just speak a bit about that. Yes, our annual issuer charges based on either on a flat basis that is capital basis or a number of full years, whichever is higher. So if you compare with last year with this year, number of folios income from number of folios are more compared to last year Because of that. And more number of IPOs incorporated because of that new issue are admitted in the system. Got it. And sir, in this, we usually have a price revision as per SEBI. So Is that due anytime soon? In 2015, they have increased the tariff. So now it is due means every 4 to 5 years both the deposit rates will go. And so now it is due, next year definitely will go to Sebi and we'll ask for the increases. Okay, got it. So the second question was so in our the IPO and corporate action charges. So what could be the mix between IPO and corporate action? I mean, if you have to strip it between these two, What would be the mix revenue mix broadly? It won't be possible to give us those figures. It's confidential, so I can't give those figures. At least what I wanted to understand is that in an environment like What we've been seeing in the last 2, 3 quarters or even more where IPOs are sort of not coming forth, So what would be the steady state revenue for this kind of a business because corporate action would still be happening and buybacks and splits and all those things will continue to happen. You can give me a The overall picture in March 2018, IPO corporate exchange charges total income was around INR 29 crores. It went down from March 2019 to of INR 19 or INR 20 crores. Now it is in similar line only. If you see 6 monthly results, it is down by INR 1 crore. So it depends on number of IPO. If you see that Prime Directory that last year it was INR 92,000 crores what IPO date is down to 46,000. So that depends on the market. Right. So actually, that was the question, sir. So this INR 18, INR 20 crores of run rate on this IPO and corporate on an environment like today where there are hardly any IPs that are coming, you think that is broadly sustainable? IPO and corporate action charges are intermingled. So it becomes very difficult to give towards IPO how much and towards corporate Because on application also we are charging and allotment also charges. So that Co meaningless, sir. Sir, if there are no I mean, if there are no IPUs, then there will be no applications also for you to charge, right? So in that sense, whatever revenue that you've been earning in the last couple of quarters, that would be Hardly any IPO, right, because there have been hardly 2 IPOs in the last 3 quarters. Yes. Theoretically, yes. That's one way of looking at it, yes. Got it. Sir, the other question was on so are KYC so on the CDSL Ventures, So a couple of quarters back, Sebby had come out with a regulation where we could not sort of Except Telecom and I think one more entity, you could not sort of use the Aadhaar to directly through the KYC. So I mean and since then also we've been able to sort of grow that part of business is not at a very good rate, at least steadily. So do you see any impact further like I mean, just wanted to hear your views on that. I mean, what how is the ecosystem coping with that? Conference. See, currently, we are not allowed to do e KYC using Aadhaar post the Supreme Court verdict. But We have been subsequent to that, there has been a circular from the Ministry of Finance that in case we want to do in KYC, we have to approach UIDI through our regulators every. And then once UIDI gives it approval, then they will notify the government and permit us as some capital market intermediaries to do EKIC. We have done all of that. We have approached our regulator and our regulator has approached the IDI to permit us to do ETAIs. So are we allowed at this point of time to do further? We have not yet received the approval. So in the absence of that So that was the question, sir. So in the absence of so we've still been able to maintain the revenues and some of it is I think is because of the government's credit also. But if you extract, how would I mean, how has that business shaped up for us? We've widely maintained Market share, but has that overall pie has de grown in the overall market? See, EKYC for all players in the market, e KYC is a problem because they are not allowed to use it right now, of course, the Supreme Court worded. UIDI has introduced something called an offline AKYC, which we have introduced for some of our clients, Where I do not require specific UID approval to go live. Okay, Okay. And this approval, you are expecting anytime soon? Or I mean, any comments on that from the new idea? All I can say it is in a very advanced stage with the idea. And so the last question from my side is on the utilization of cash. So while we have a good payout ratio, but I think if you look at of the other similar kind of businesses, the payout ratios, there is a room for payout ratios to go even higher. So I mean, any comments on that, if you can maybe Layout, what is your thinking and what are you thinking at the Board level? We are a market infrastructure institution. It's licenses which we get for various products and financial resiliency in terms of cash balances becomes an important component when that license is granted. So whilst we ensure that there is a payout ratio, so that whatever is earned as the operating income gets paid out to the shareholders. There is also a need to keep will be a sufficient amount of optimum cash balances to show the overall financial health of the company, which is necessary for future growth of the business. Right. So I think if I get the number that we have about INR 700 INR 7.20 crores of cash on the books at this point of time. But and we are waiting around INR 300 crores of regulatory cash requirement. So in that sense, we have excess of INR 500 crores as cash, which can be used as for this for our overall shoring up of our financial revenues. But anything incrementally that we are signing because there is no incremental requirement in terms of CapEx or anything. Just on that, I think call. 40% to 45% on a consolidated business. So on that, I mean, Do you think that this is optimum? Or are you think I mean, is there a Possibility of this in demand. So, with the subsidiaries, you should not only look at the requirement that regulatory capital of CDSL as a parent, but also a subsidiary like CBL, etcetera, would require sufficient amount of Regulatory Capital, be it NAND or be it the going real venture and the government projects which we are getting. This becomes a very important component when government projects, which are large in size, which would get awarded to us. So I think it is what we have stated earlier is that the operating income will We will be having we will be maintaining a high amount of payout ratio. But I think the current cash levels are necessary keeping in mind some of the future ventures which are expected to come. The next question is from the line of Itay Chien from Investecare Mutual Fund. Please go ahead. So this quarter, what was I think you gave that number. So what was provisions for doubtful debt this quarter? This quarter, INR 2.45 crores. 2.24. Okay. So if I add, so previous quarter it was 1.6 and Total 4 crores. Total INR 4 crores. Yes, total INR 4 crores. But last few years as I see the data, we used to have provisions for doubtful debt in the range of INR 2 INR 2 INR 3 crores for the full year. No, no. Even last year, provision for doubtful debt was INR 4.95 crores. But the impact There you have to see bad debt as well as provision for doubtful debts. So overall impact will be around INR 3 crores. Yes. So this line item impairment loss allowance on trade receivable in FY 2019, we had INR2.93 crores. Correct. But here, if you see last year my income was INR66 crores from any research, I guess it went up to INR80 crores. So similarly, doubtful that's also increases. But so you're saying for the first half, it is 4. And for second half also, we should annualize it. So for the full year, we should expect gross rupees. See, that is around 75% to 80% I'm getting in 1st 2 quarters, whatever 84% already will recover. Now only 16% will recover. So it depends On our recovery, that it depends. But as a what expected credit loss policy, we have to do it under Indes. So you're saying the second half would have a lower provisions for doubtful debt compared to first half, as per the interest possible? Possibly, probably not Otherwise, it is 8 gross. What do you mean to say? Okay, okay. So that means whenever your annual issuer charges goes up meaningfully, you would also have provisions for doubtful debt? Yes, that is true. That is true. Okay, okay. All right. Okay, thanks. Thank you. Thank you very much. As there are no further questions, I will now hand the conference over to the management for closing comments. So I think as I stated earlier, I've just joined around 3 weeks ago, we are in the business of a market infrastructure institution. And while we are a part of our revenue is dependent on the movement of the market, But really overall, it is the technology spend as well as the quality of our service, which is going to ensure and also the distribution network, which is is critical to our business. So we have around 606, in depository participants vis a vis our competition at around 280. And I think that will become a critical portion as we move forward. The general government's push to move physically into a digital mode is also is going to become an important impetus to our business. But having said that, we need to continuously reinvest in our technology in our systems and in our people to ensure that this module keeps on consistently going on. I would like to wish all of you a very happy Diwali and a prosperous New Year, and thank you all for joining the call. Thank you very much. On behalf of Access Capital Limited. That concludes this conference. Thank you for joining us. You may now disconnect your lines. Thank you.