Standard Chartered Bank is preparing to divest its investment in Central Depository Services (India) Ltd (CDSL) by selling its entire stake through a block deal. The bank intends to sell 7.5 million shares, equivalent to a 7.18% stake in CDSL, as per a term sheet examined by Mint.
The estimated total value of the deal stands at up to $151 million. Standard Chartered is offering the shares at a floor price of ₹1,672 each, representing a discount of 6.5% from CDSL’s closing price of ₹1,788.90 on the NSE on Tuesday.
JP Morgan India Private Limited is reportedly overseeing the sale process on behalf of Standard Chartered. An immediate response wasn’t received to an email sent to a CDSL spokesperson.
This development occurs against the backdrop of CDSL delivering impressive returns to its investors. Over the past year, the stock has seen a remarkable surge of 90.25%, significantly surpassing the returns of the Nifty Smallcap 250 index, which stood at 62.7% over the same period.
According to a JM Financial report dated 7 February, Indian capital markets are poised for growth owing to the country’s robust economic potential and stable political and macroeconomic environment, which bodes well for CDSL. However, the report notes, “We believe the stock remains fairly valued at current valuations of 44x/40x FY25/26E P/E.”
