National Securities Depository Ltd IPO

India`s first and leading depository operating a wide range of technology-driven businesses.

Strong focus on technology-led product innovation.

Robust IT infrastructure, risk management frameworks and cyber-security measures focused on ensuring the safety and integrity of the depository system.

Stable revenue base with a significant proportion of recurring revenue.

Diversified Asset Classes held in Demat Accounts and Well-diversified Business Verticals.

Experienced senior management team.

If there is a shift in investor preferences away from investing and trading in securities to other avenues, it could reduce demand for its services and adversely affect the company business, financial condition, and results of operations.

The company failures to expand its service offerings and market reach through continued innovation and development of new products and services through technology-based solutions or the failures of these new service offerings may have an adverse impact on its business.

A large proportion of the Company`s business is transaction-based, in particular, delivery-based, and dependent on trading activity in the securities market. External factors beyond its control may affect the trading volumes which could adversely affect the company business, cash flows, results of operation and financial condition.

The company relies on complex information technology networks and systems to operate its business. Any significant system or network disruption due to a technical glitch, breach in the security of the company IT systems or otherwise, could have a negative impact on its business, reputation, results of operation and financial condition including levy of financial disincentive by SEBI.

The company operates under a stringent regulatory regime and its inability to comply with the company legal and regulatory obligations may expose it to regulatory proceedings and legal actions by the Securities and Exchange Board of India.

The company closely compete with its competitors across the company businesses in a highly regulated environment. Any failures to compete successfully could have an adverse effect on its business, financial condition, cash flows and results of operations.

The company depends on its network of depository participants and the service centers owned, operated and maintained by such depository participants for a large portion of its business. Any inability to effectively manage and increase this network could adversely impact the company growth, cash flows, results of operation, and financial condition.

On account of its operations, the company Subsidiary, NDML, is subject to regulatory requirements prescribed by various authorities including IRDAI, SEBI, UIDAI and RBI. Its inability to comply with applicable laws, regulations and norms may have an adverse effect on the company reputation, businesses, financial condition and results of operations.

SEBI has issued certain observations pursuant to inspections and has also issued administrative warning letters and deficiency letters in relation to certain non-compliances by the Company. There can be no assurance that further observations, administrative warning or deficiency letters would not be issued in the future.

The Company has been subject to enforcement actions, in the past, by way of issuance of show cause notices by SEBI in relation to violations/ non-compliances of relevant SEBI laws by our Company. There can be no assurance that such actions will not be taken against the Company in the future.

The company is subject to various legal and regulatory obligations which may expose it to regulatory proceedings and legal actions by the concerned authorities.

There can be no assurance that the company will be successful in implementing its current and future strategic plans, and its efforts to expand our service offerings and market reach may not succeed and may impact our revenue and growth.

The company is required to obtain various approvals in relation to its business and the company inability to be able to obtain or renew such approvals may affect its business and results of operations.

SEBI in-principle approval requires it to complete the listing process before April 13, 2024, which has been extended till August 14, 2025. If the company fails to comply with this deadline, its may be required to apply for an extension or a fresh approval, which may not be granted in a timely manner, or at all.

Our principal Shareholders, IDBI Bank Limited and National Stock Exchange of India Limited, are required to dilute their shareholding in our Company on or before August 14, 2025, as required under the SEBI D&P Regulations.

There are outstanding legal proceedings involving the Company, its Directors, and the company Subsidiaries.

Its may not be sufficiently protected or insured for certain losses that the company may incur or claims that its may face against the company.

The company has entered into and will continue to enter into related party transactions. Its cannot assure you that such transactions will not have an adverse impact on the company business, financial condition, cash flows and results of operations.

The company utilize the services of certain third-party vendors for its operations. Any deficiency or interruption in their services could adversely affect the company business and reputation.

Non-compliance with laws relating to privacy and data protection could result in claims, harm its results of operations, financial condition, and prospects.

Payments banks in India, including its Subsidiary, NPBL, are subject to regulatory requirements and prudential norms. Its inability to comply with applicable laws, regulations and norms may have an adverse effect on the company reputation, businesses, financial condition and results of operations.

Appointment of its Public Interest Directors does not require shareholders` approval.

NPBL is required to comply with applicable know-your-customer, anti-money laundering and antiterrorism laws in India. However, NPBL may not be able to detect money-laundering and other illegal or improper activities in a comprehensive manner or on a timely basis, which could expose it to additional liability and harm the company business or reputation.

The company is subject to higher penalties and settlement amounts as a market infrastructure institution and may be required to contribute a higher percentage of its profits to the Investor Protection Fund, which may adversely affect the company profitability and dividend payments.

The company operates in a business environment that continues to experience significant and rapid changes in technology. Any failures to keep up with these changes may have an adverse impact on its business.

A failures to generate income from fee and commission-based activities by NPBL may have a negative impact on the company financial performance.

Its payments bank business involves high operating expenses leading to a high cost-to-income ratio and had incurred losses in the past.

A majority of its revenue from operations are derived from the company banking services.

The company has experienced negative cash flows in the past. Any negative cash flows in the future could adversely affect its results of operations and financial condition.

Delays or defaults in relation to its trade receivables could adversely affect the company financial condition.

The Company is neither associated with nor related to Protean eGov Technologies Limited. Further, the business of the Company is not similar to that of Protean eGov Technologies Limited.

Its payments bank operations depends on the accuracy and completeness of information about merchants, business correspondents, customers and business partners which, if inaccurate or materially misleading, could adversely affect its business and results of operations.

The company depends on its brand recognition. Negative publicity, failure to maintain and enhance awareness of its brand or any damage to the company reputation could have a material adverse effect on its business.

The company is subject to the risks associated with certain of its premises being leased. Non-renewal or dispute with the lessors may disrupt its business, and the company may be subject to significant increases in lease rentals.

The company faces risks when entering into or increasing its presence in markets where the company does not currently operates or when entering into new business lines. Demand and market acceptance for its products and services within these markets would be subject to a high degree of uncertainty and risk.

The company may, on its own accord pursuant to commercial requirements or pursuant to directions from regulators, divest its stake in the company Subsidiaries, or may demerge certain of its businesses into a new entity.

NDML`s KRA operations are subject to certain regulatory mandates and market risks, which may adversely affect its results of operations.

Proposed changes in the Government policies and other factors beyond its control may result in a potential loss of revenue for NDML`s SEZ Online business.

If the company is unable to keep its business development strategies and other commercial decisions confidential, it could adversely affect the company competitive advantage.

Its principal Shareholders will continue to hold a substantial equity stake in the Company after the Offer and will continue to be able to influence the outcome of any shareholder voting, which may conflict with the interests of other shareholders.

If the company is unable to obtain, protect or use its intellectual property rights, the company business may be adversely affected.

The company depends on its Key Management Personnel and Senior Management, as well as its experienced and capable employees. During the Financial Year 2025, the company had an overall employee attrition rate of 23.23%. Any failures to attract, motivate, and retain its employees could harm the company ability to maintain and grow its business.

Any failures to maintain the quality of customer service across its businesses, and deal with customer complaints in a timely manner could materially and adversely affect the company business and operating results.

Materialization of its contingent liabilities could adversely affect the company financial condition.

This Red Herring Prospectus contains information from an industry report prepared by an independent third-party research agency, CRISIL Intelligence, a division of CRISIL Limited ("CRISIL"), which the company has commissioned and paid for exclusively in connection with the Offer and any reliance on such information for making an investment decision in the Offer is subject to inherent risks.

The company track certain operational and key business metrics with internal systems and tools. Certain of its operational metrics are subject to inherent challenges in measurement which may adversely affect the company business and reputation.

Its role and responsibilities as a securities depository may conflict with the company Shareholders` interests.

Some of its investments in debt instruments are unsecured, or carry interest rates lower than the market rate, and the company has not made any provision for a decline in the value of its investments.

In the event of a default in relation to an investment, the company will bear a risk of loss of principal and accrued interest. The geographic concentration of its investment portfolio makes it vulnerable to a downturn in the Indian economy.

The Company may be subject to operational risks, such as failures in execution, wrong execution and/or fraud, in the future impacting its business, financial conditions and results of operation.

Its depository operations are exposed to a financial risk of issuers not paying the company annual custody fees for the company depository services.

The company has in the past experienced a loss of market share in the depository business due to the rapid emergence of new age fin-tech brokers.

The operations of its core depository business, including introduction of new products and the amount charged for provision of various depository services, are highly regulated.

Its roles and responsibilities as a securities depository may conflict with the interests of certain of the BRLMs and their group companies.

The risk management system of the Company may not always be adequate and compliant with the SEBI laws.

Any delay in payment of statutory dues or non-payment of statutory dues in dispute may attract financial penalties from the respective government authorities and in turn may have an adverse impact on its financial condition and cash flows.

One of its Directors, Sriram Krishnan is a director on the board of directors of India International Depository IFSC, which is in the same line of business as the Company. Any conflict of interest that may occur as a result could adversely affect its business, financial condition, results of operations and cash flows.