Shares of CDSL have taken a hit after Standard Chartered Bank sold its 7.18% stake in the company through block deals. This move comes amidst the company's impressive returns for investors, with a net profit of Rs 107.48 crore for the December quarter. Meanwhile, CDSL has also received approval from market regulator Sebi for further investment in ONDC. Keep up with the latest stock market updates on Zeebiz.com.
CDSL Share Price Takes a Hit After Block Deal Sale
Central Depository Services (India) Limited (CDSL) has been in the news recently after Standard Chartered Bank sold its 7.18% stake in the company through block deals. This has led to a decline in the share price of CDSL. The company's shares closed at Rs 1,237.75 on Monday, down 5.86% from the previous close.
Background
CDSL is one of the two depositories in India, along with NSDL. Depositories are responsible for holding and maintaining securities in electronic form. CDSL has a market share of around 55% in the Indian depository market.
The company has performed well in recent quarters. In the December quarter, CDSL reported a net profit of Rs 107.48 crore, up 23% from the corresponding quarter of the previous year. The company's revenue also increased by 20% to Rs 254.73 crore.
Standard Chartered Bank Sale
Standard Chartered Bank sold its 7.18% stake in CDSL through block deals on Monday. The bank sold 2.4 crore shares at a price of Rs 1,240 per share. The deal was worth around Rs 2,976 crore.
The sale comes amidst a broader decline in the Indian stock market. The benchmark BSE Sensex index has fallen by over 10% since the start of the year.
Market Reaction
The CDSL share price fell by 5.86% on Monday after the Standard Chartered Bank sale. The stock has now fallen by around 15% from its 52-week high of Rs 1,460.
Analysts say that the sale by Standard Chartered Bank is likely to weigh on the CDSL share price in the short term. However, they believe that the long-term prospects for the company remain strong.
Top 5 FAQs
Standard Chartered Bank has not disclosed the reasons for selling its stake in CDSL. However, analysts speculate that the bank may have sold the stake to raise capital or to rebalance its portfolio.
The sale is likely to have a negative impact on the CDSL share price in the short term. However, the long-term prospects for the company remain strong.
Analysts believe that the long-term outlook for CDSL remains strong. The company is benefiting from the growth of the Indian capital markets.
Analysts say that it may be a good time to buy CDSL shares for long-term investors. However, investors should be aware that the stock price may continue to fluctuate in the short term.
The main risks associated with investing in CDSL are:
* **Market risk:** The CDSL share price is subject to fluctuations in the overall stock market.
* **Competition risk:** CDSL faces competition from other depositories in India, such as NSDL.
* **Regulatory risk:** CDSL is subject to regulation by the Securities and Exchange Board of India (SEBI).
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