Shares of National Securities Depository Ltd (NSDL) fell nearly 5% on the BSE on Wednesday, marking the first major decline since the company’s strong market debut last week. The sell-off in the country’s oldest and largest depository was triggered after it reported weaker-than-expected June quarter results.

NSDL shares declined by as much as 4.93% to ₹1,225.25 on the BSE, while its market capitalisation dropped to ₹24,630 crore. Earlier today, the stock opened up by 0.7% at ₹1,298, after ending 1.24% higher at ₹1,288.80 in the previous session.

NSDL made its debut on the BSE on August 6, with its shares listing at ₹880, up 10% over the initial public offering (IPO) price of ₹800. The counter rallied by as much as 78% in the first four sessions to hit a record high of ₹1,425 on August 11.

The depository stock has ended higher in four out of the five sessions so far, settling 2.1% lower on August 11 as investors booked some profit at higher levels.

The stock retreated today after the company's Q1FY26 results showed slower revenue growth and margin pressure, prompting profit-taking.

Analysts said the correction was expected after the sharp listing rally. “After 65-70% rally in a few days it is recommended booking some profits, especially for short-term and listing-gain-focused investors. The near-term upside may be capped after such a sharp move, and markets tend to see consolidation post a robust debut,” said Nitin Jain, Sr. Research Analyst at Bonanza.

“If you are a long-term investor willing to ride out near-term volatility, NSDL remains a high-quality stock supported by rising demat penetration,” he added.

NSDL posted a 15.16% year-on-year (YoY) rise in consolidated net profit for the June quarter of the current fiscal. Net profit rose to ₹89.62 crore in Q1FY26 from ₹77.82 crore in the corresponding quarter last year.

Revenue from operations, however, declined 7.49% to ₹312.02 crore in the June quarter of FY26, compared with ₹337.29 crore a year earlier, NSDL said in a BSE filing on Tuesday.

According to the RHP filed with the Sebi last month, NSDL clocked 24.5% YoY growth in its net profit to ₹343.12 crore in FY25, while revenue increased 12.4% YoY to ₹1,535.19 crore.

Formed in 1996 with the backing of institutions such as the National Stock Exchange (NSE), IDBI Bank, and Unit Trust of India (UTI), NSDL laid the foundation for India’s capital market infrastructure. The company primarily serves large institutional clients, including foreign portfolio investors (FPIs), custodians, and mutual funds.

As of March 2025, NSDL managed ₹464 lakh crore in assets under custody (AUC) through a network of 65,391 depository participants’ service centres. In FY25, it held a 73.04% market share in unlisted equity companies, 66.03% in dematerialised share settlements, and 65.27% in active instruments.

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