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Central Depository Services (India) Ltd
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Ladies and gentlemen, good day, and welcome to the Q2 FY '22 Earnings Conference Call of Central Depository Services (India) Limited, hosted by Axis Capital Limited. [Operator Instructions] Please note that this conference is being recorded.Please note that CDSL does not provide specific revenue or earnings guidance. Anything said on this call which reflects CDSL's outlook for the future or which could be constructed as forward-looking statements must be reviewed in conjunction with the risks that the company faces.I now hand the conference over to Mr. Anshuman Singh from Axis Capital. Thank you and over to you, sir.
Thank you, Madhuri. Good morning, everyone. On behalf of Axis Capital, a very warm welcome to the Q2 FY '22 conference call of CDSL India Limited. We have the management team of CDSL represented by Mr. Nehal Vora, Managing Director and CEO; Mr. Girish Amesara, Chief Financial Officer; Ms. Nayana Ovalekar, Chief Regulatory Officer; Mr. Ramkumar, Chief of Business Operations; Mr. Vinay Madan, Chief Risk Officer; Mr. Sunil Alvares, Managing Director and CEO, CDSL Ventures Limited; Mr. Swaroopkumar Gothi, VP; and Mr. Nilesh Kittur, AVP.Without further ado, I will hand over the call to the management for their opening remarks, post which we can open the floor for Q&A. Thank you and Nehal sir, over to you, sir.
Thank you, Anshuman. I wish everybody a very good morning. I welcome you all to the CDSL's quarterly conference call first quarter ended September 30, 2021. And I hope each one of you and your loved ones are safe and healthy. I'm joined on this call by other management -- other members of our management team, who will address your questions later, as you may have.Throughout the history of CDSL, we have invested and invented in our business to build a truly diversified and strong organization that performs across market regulations and developments with a commitment to serving investors, all market infrastructure institutions, regulators, shareholders and employees. The current financial year is also a representation where we have experienced some good business and financial performance as a result of the efforts of all market infrastructure institutions.The growth of the demat accounts is also a reflection of the growth in the unique client codes at the stock exchanges. With the growth in business, we continue to focus on providing services to the securities market and to the investors at large to strengthen and execute our vision of making our investor truly self-sufficient or Atmanirbhar. We continue to provide our platforms and e-services, such as Easi/Easiest, eDIS, e-voting, et cetera, that aim at providing convenience to the investor to operate their demat accounts from the comfort of their homes.I'm sure that all of you would have already reviewed the financial results and the investor presentation for the quarter.Now I request Mr. Ramkumar, our Chief of Business and Operations, to take you through our business performance. Over to you, Ram.
Thanks, sir. Good morning. I'll just take you through the business update. In the last 3 months, that is a quarter 2 of '21-'22, we have opened approximately 68 lakh accounts. The growth has taken the total number of active accounts, the BOIDs, as at the end of Q2 FY '21-'22 to 4.65 crore accounts. Those value of securities in the demat custody has increased to 35.21 lakh crores.We continue to provide services in line with the transformation and requirements of the current times to promote digital initiatives of the government. In addition to our e-Voting services, we also offer services to all Annual General Meeting through the video conference to make the AGM a hassle-free event for the shareholders and the company. We also provide e-mail updation services as well as a mobile -- that is mobile updation services to companies to update their shareholder database to ensure that the dissemination of communication to the shareholders is valid, sufficient and productive.Before I hand over to our CFO, I would like to take a brief moment to place our appreciation and gratitude to all of our stakeholders. The benefits on us, the depository participants, the issuers, the regulators, employees and other market participants for their constant faith in us.Now I'd request Mr. Girish, our CFO, to take you through our financial performance. Thanks.
Thank you, Ramkumar. Good morning, everyone. On the financial performance, the total income on a consolidated basis for the quarter ended September 30, 2021, has increased by INR 63.98 crores, which is representing 63% to INR 165.15 crore against the previous year same quarter income of INR 101.17 crore.The net profit on a consolidated basis for the quarter ended September 30, 2021, has increased by INR 37.19 crore, which is 76%, to INR 86.06 crore. And corresponding previous quarter, it was INR 48.87 crore. The total income on a stand-alone basis for the quarter ended September 30, 2021, has increased by INR 48.77 crore, which is almost 62%, to INR 127.92 crore against previous year same-quarter income of around INR 79.15 crore.The net profit after tax on a stand-alone basis for the quarter ended September 30, 2021, has increased by INR 30.34 crore, which representing 80% increase, to INR 68.40 crore against the previous year same quarter total net profit of INR 38.06 crore.Now I would request the Sunil Alvares to take through about -- talk about the operations of our wholly owned subsidiary, CDSL Ventures Limited. Thank you. Sunil, over to you.
Yes. Thanks, Girish. Good morning to all of you. On the CVL front, we had another good quarter in terms of the KYC records created, increased by 36 lakhs in this entire half year. So there was a growth of almost 130% in terms of new records created.In terms of the KYC record which were fetched by intermediaries from CVL, the number of records jumped from 60 lakhs in H1 FY '21 to 1 crore 56 lakhs in FY -- H1 FY '22, which was a growth of about 158%.In terms of CKYC records processed also, there was a jump of almost 31%, that is from 5,83,000 records to about 7,63,000 records. And similarly, on the RTA front also, the number of companies currently handled by CDSL is 70 -- 750 as compared to 665 in H1, FY '21, which was a growth of about 13%.With regard to the financial results for H1 FY '22, okay, the operational income increased by 95% as compared to H1 FY 2021. And the total income increased by 77% from 38.15 crores in H1 FY '21 to INR 67 crores in H1 FY '22.The profit before tax increased by 75% in H1 FY '22 to INR 43 crores as compared to INR 24 crores in the same period last year. And the profit after tax increased by 71% in this year, so that the profit after tax was INR 32.61 crores in H1 FY '22 as compared to INR 19.05 crores in H1 FY '21.With that, I hand over back to Anshuman so that we can have the Q&A session.
[Operator Instructions] The first question is from the line of Kunal Thanvi from Banyan Tree Advisors.
Congratulations on a great set of norms and happy to be alto the entire management team and the parties of subsidiaries. So my first question was on the KYC business, like we have seen notification coming for eKYC, where there was a reduction in the charges by UIDAI. Can you help us understand, how does that impact our realizations for new verifications, new registrations under the eKYC business? That is question number one.Second is in respect to technology glitch that was found in -- again in the CDSL Ventures there was a news article, wherein first time that there was some vulnerability in the systems. If you can take us through what actually happened and where we are in terms of cybersecurity, among other things?And thirdly, on mutual fund Central as a platform that came up last month -- last quarter, like how is CDSL playing a role there or, in fact, the board deposit we're playing a role there, how much -- like is there any financial opportunity going ahead because of this platform coming in? Yes, these would be my three questions.
Okay. I'll ask Sunil to take the first 2 questions, and then I'll take the third question. So over to you, Sunil.
Yes. Can you come with your first question again? I have some slight disturbance.
Yes. So there was a notification that UIDAI has reduced the new registration charges for eKYC. So wanted to understand does it also translate into our realization for eKYC coming down from INR 20 to INR 3?
Yes. I mean, see, what happens is so far as eKYC is concerned, we normally charge whatever is CVL charges for eKYC plus the UIDAI charges. So to that extent, if the UIDAI charges comes down, okay, so whatever we bill the customers would be down from, say, INR 25, what we were charging earlier, to maybe about INR 8, what would be the charges after the UIDAI revision.So to that extent, that -- the top line could get impacted. And so far as the bottom line is concerned on the expenses side also, the expenses would be restricted to just INR 3 now as against INR 20 earlier. So I hope that answered your first question.
So not only -- like it will go out from revenue it will go out from cost. Hence, for us, the land realization remains the same, right?
It remains the same, yes. Okay.
Great.
Point number two is on the glitch which was there in CVL. First and foremost, it was a vulnerability alert, which we had to see, okay? And unlike what the news -- some of the news articles said, there were a lot of factors -- it's actually incorrect things mentioned in that.We have identified the glitch. Our IT team have identified the glitch, and we have thereafter plugged the same. And secondly, you have to appreciate that it was within the investor login of the KRA data -- KRA. So that any investor who wants to log in and see the status of his KRA has to mention his PAN and date of birth, and then he gets an OTP. So to that extent, it was extremely affect us. So somebody who is extremely IT-savvy could have gone and taken advantage of it. But actually, it has not happened, and we have also confirmed that there has been no data breach at all.
Sure. That makes sense, yes.
And on the third one, on mutual fund Central, I think the first is divided into 2 phases. First is the RTAs will gather the information from the depositories. We are already sharing that data with the RTAs. As Phase 2, I think, possibly by the end of the calendar year or in the first month of next calendar year, January, the Phase 2 will get initiated where the depositories also will start getting the files from the RTAs. So it will be a 2-way mutual fund Central information platform, which will be available across RTAs and the depositories.
So if I get it a Phase 2, we will also be able to monetize something out of it, right?
Yes. So that we will wait and watch. There is an expectation. But again, we'll be in difficult to comment on that at this stage because what would be the charges, et cetera. To begin with, it may be kind of probably 3 or next to 3. But we'll see how it goes. It's finally driven by the regulator. So we see how the charges, et cetera.
Right now it is free of cost? Yes.
Yes.
Sure. Got it. If I can squeeze just one more from -- for like Girish. I wanted to -- so there has been a change in the revenue segment is subject this quarter in the presentation. If you can help me with this quarter's number for annual issuer charges, transaction charges, online data charges, IPO and corporate action, consolidated cash, e-Voting and others, it would be like very helpful?
Okay. So the transaction charge for quarter 2 is INR 49.73 crores. IPO corporate action income is INR 21.5 crore. Online data charge income is INR 30.29 crores. Annual issuer income for the quarter is INR 28.81 crores. e-Voting is INR 5.09 crores and cash statement charges is INR 3.69 crore. I hope I've answered your question.
Sure, Girish. That is helpful.
[Operator Instructions] The next question is from the line of Amit Chandra from HDFC Securities.
So my question is related to the -- the insurance depository. So like what's happening there? So we have opened around 6 lakh insurance accounts. So are we seeing any pickup there? So that is the first question. And another question is on like similarly on the commodity depository be like is staying CCRL. Are we seeing any pickup there? And also -- and the third question will be, we have seen that the competitors has been aggressive on the payment side, right, on the -- like on their offering like banking services apart from depository services. So like, are we having any plans to offer such kind of services?
Okay. I'll ask Ramkumar to answer the insurance question, and I'll answer the commodities and the payment bank question.
Sir, as far as the insurance business is concerned, presently, not many insurance companies have taken to it for the reason that it is not mandated by the regulator. That is point number one. Point number 2 is that as we go along, we are seeing people showing interest in holding policies in the electronic form, but we are a long way away from the way the depository or the securities market has kind of evolved from the time the deposit we started in late '90s.
In terms of the commodities business, it's also going through a fair amount of changes on the regulatory front. It's a regulated business. And I think there are discussions happening across extending the eNWRs, not only in the agri-based business but the non-agri-based business. So we'll have to -- we are there in terms of there. And the important thing is that we've kept our costs under control so that the entire business remains profitable. But at the same time, we are there with the requisite building blocks to ensure that this entire business can be taken up as and when the rules permit them to do.As regards to payment bank, that is -- that has been assessed in the past at CDSL around 3, 4 years ago. We continue to assess new and new opportunities as to whether it is feasible within the framework. There are certain levels of conditions which needs to be fulfilled. So CDSL would be -- it would be eligible. But our teams are constantly assessing in terms of the business opportunities, which would be the most important businesses to be to take this forward.
Sir, in terms of the license, we have the payment bank license, or we have...
No. We don't have the payment license as of now.
Okay. So first, you'll have to apply for that evaluated and then we can go ahead?
First will be the evaluation, and then we will see if it's feasible and then we'll take it forward from there.
Okay, sir. And sir, on the annual issuer charges, like what has been the progress on the addition of unlisted because like during COVID, it has slowed down. But have you seen like any kind of pickup there? And also on the RTA front, will RTA going to be a significant line of business for us? Because we have -- the RTA license, but we have not been seeing any significant traction there.
Yes. So this quarter has seen some robust growth in the -- in terms of the annual issuer fees as well as the RTA business with CVL. So that continues to grow as more and more companies will access the securities market. We will start seeing more and more traction out there. So it has seen fairly good growth over the previous year. So we are continuously there, and we continuously want to innovate to ensure that it becomes easier for companies to access our platforms.
Okay. And also, sir, in terms of the revenue from the pledge side, so has that seen -- let's say significant traction of the monthly rate of 1.5 crores to 2 crores is like what you are seeing there on the press side?
We kind of disclosed it as a consolidated number as part of our market driven. We don't -- but it is a function of the overall market in delivery volumes. And as we are seeing a good buildup on the cash market volume and the delivery-based volumes, this is kind of a function of that. So that is also seeing some amount of growth.
[Operator Instructions] The next question is from the line of Paresh Sangani from Club Millionaire.
Congratulations Nehal to you and your entire team for yet again a fantastic performance.
Thank you.
And on a heartly festive greetings to all of you as well. Now I'll just -- I had some questions which have been answered by Kumar. I'd just add a couple more. First is, you have almost INR 1,000 crores of mage cash line with that. I want to get your perspective -- I know it's required for network purposes. What about inorganic opportunities like getting into edges and offerings? For example, we are late into refi. Would we consider acquiring from somebody making into a different product offerings?And then the second one would be regarding, is there any one-off on the KRA of? Because I remember the semi mandate draft that they wanted to update all the KRA, right? So it would be a onetime project. And I know that we had about 60-odd percent market share. And therefore, we may not have to update our process. So have we done anything on that? Or is there any update on that as well?And thirdly, on the old projects like NAD, national accounting project and policy, right? Any update on that as well? Any progress on that as well Nehal?
Okay. I think all of these are pertaining to CVL. I'll ask Sunil to answer these 3 questions.
Yes. The first question you had was on one-off on the KRA, okay? So far as the KRA update is concerned, okay, we are continuously updating as and when any modification, et cetera, reported to guide report is mandatory, because it's the responsibility of the reporting entity data KYC. We have already validated all the plans, et cetera, with the IT database. So to that extent, our database is updated. And we'll be shortly also updating the PAN Aadhar rate case. So to that extent, it will be updated with the PAN Aadhar limited as well.The second part is on the NAD progress is that the MHRD had decided that DigiLocker will be the sole depository for National Academic Depository, and both the depository would be out of that. So effectively, for the last 2 years, DigiLocker is the depository.We have tried to offer this service as a private service vendor to various universities. So far, we have around 8 universities who were registered with us. But we had has -- I mean, problems during the lockdown because most of the universities, et cetera, were closed. So we couldn't touch base with most of them. So maybe once this lockdown thing normalizes, then maybe we will see more universities run that. So we are keeping our fingers crossed on that. So I hope that answers your question.
Yes, Nehal. The question on the capital allocation, INR 1,000 crores is an organic opportunity?
Yes. Yes. So I think as a market infrastructure institution, once the minimum regulatory capital is maintained, the strength of the balance sheet is extremely critical when you are running a financial -- market infrastructure institution company. We have a fairly liberal dividend policy of distributing about 60% of our operating profit as dividend.But it is also important to build the balance sheet that, whenever case if there is basically a year in which the income is muted, et cetera, the financials of the company remains strong, and it becomes a very stable company going forward.So my sense is that we will continue to being embark upon building the strength of our financial statements, especially the balance sheet. Keeping in mind the shareholder interest, we have embarked upon a 60% -- about 60% of the operating profits has been declared as if you had dividend to the shareholders.
Nehal, I was asking on the inorganic opportunities, right? I mean, are we looking at acquiring any companies, et cetera, from the existing product offering within our realm of affair?
No. So in the current scheme of things, we are building on our existing platform, our technology platforms because the scale of business growing, if we prepare for basically the infrastructure and getting the more advanced infrastructure in. So technology is going to be spend. Also the people, as we are growing in scale, we'll need to increase our teams also to ensure that we're able to service them.We are fully in sync with the opportunities like the IFSC GIFT City, a Gold Spot Exchange, which will have a depository arm also coming in, both in the local and the foreign jurisdictions. And we are completely -- like the mutual fund Central is another business line, which is going to be this.So I think it's kind of more of an internal growth in terms of newer platforms and products coming in. We believe technology is the main driver of our businesses that to gain control of that. And accordingly, we prefer to kind of build most of them internally. But having said that, if there are some interesting opportunities which may come up in future, we will consider on a case-by-case basis.
Just last one question, if I can squeeze in, Nehal is on eSign. We may this offer of products. Is it only a onetime cost basis or charge basis? Or is it going to be an annuity kind of a basis? I'm sure you've launched it by now. Some perspective on that would help.
So it is on a per eSign basis. So as the intermediary uses our facility for eSign, you will be charged on a per eSign basis.
Can this is operational, right, Sunil? Fully operational?
Yes. This is operational.
It's operational.
The next question is from the line of Gokul Maheshwari from Awriga Capital.
Can you please give and how you could play a role in the account aggregator opportunity, whether CVLs in have a business model over there?
So 0the account aggregator model is basically an RBI-initiated platform, which is to a nonbanking finance company. But I think there are various models which are being debated and deliberated at a policy level.We kind of have in a conceptual sense the consolidated account statement, which gives a list of all the financial assets in the securities market being given to the investor. And obviously, the policy thinkers are also thinking of the other nonsecurity-based assets can also be added to ensure that it gives a far wider consolidated view of a person's financial assets.So that is as and when the policy and the permissions permit us, but we are constantly innovating to ensure that it continues to remain easy for the investors going forward.
But you would consider being playing an active role in this particular opportunity if it were to come off?
Yes. Yes, of course, because we are an integral part of the entire ecosystem. And we are a repository of the financial assets of the customer. So we are definitely within -- we would be definitely wanting to be a part of it, and we shall be a part of this as and when the policy kind of opens up on this.
[Operator Instructions] The next question is from the line of Kunal Thanvi from Banyan Tree Advisors.
So my question was again on the same question I hopefully I'd asked on the account aggregator. So if we look at how things have been playing out, there has been a long talk about the single demat in India, which are of all the assets -- financial assets that one can buy. However, in the last 6 months, we have seen account aggregators coming up in a big way and then there's a kind of something if you consolidate those mutual fund holding at one place. How on a policy level, what's the sense in terms of getting the last mile with is signal demat across financial assets? Any color on that? And from the policy point of view and from CDSL point of view, how we plan to participate there?
So this is yet being deliberated. So it's yet work in progress. It's not yet formulated as to how it will go on a consolidated basis. But I think I would just like to assure you that CDSL will definitely be there in whichever form it comes out. We have already started some pieces of it in terms of, as you mentioned about mutual fund Central, and also the consolidated account statements, as I mentioned earlier.So the important theme which I would like to focus on is that CDSL continues to engage itself to ensure that it is completely up to speed in terms of what is permissible within that regulatory framework. As and when it opens up, we should be there to ensure that we are able to take -- or rather basically extend this facility to the newer avenues as and when they're permitted by the regulators.
Sure. Got it. And second question was on the Gold Spot Exchange thing. Like any development there? Like how things are moving on the regulatory front? Like when should from, say, 1- or 2-year perspective, like when could it be operational and up and running?
On the local side, there are a lot of policy deliberations going on as to how the regulatory framework will be formulated. I think it will take probably 1 or 2 quarters, looks like -- from the looks of it. But it will be difficult to predict as to when it will go live. But I think about 2 to 3 quarters, it should be really up and running. But we'll have to wait and watch. I will not be able to firmly comment on the basis.
Makes sense. And lastly, on the annual issuance charges, like the -- is there any talk about -- like I understand also depository you have to make a got this existing? Any visibility there or are you still trying to hold it down for a year or so?
We'll wait and watch yet. We'll see how this COVID should completely resolve I think -- and then we will take a call jointly bring the 2 depositories.
The next question is from the line of Sujan Kumar, an individual investor.
I have one question. Sir, I'm trying to go through your latest financial report, so this financial year 2021. I believe there with the find of. Is there any reason why it is not released?
Financials have been released a day it got announced, on 30th October. It is there on the CDSL website as well as the NSE website where we are listed on. So you can access it from either of the places.
[Operator Instructions] The next question is from the line of Sanketh Godha from Spark Capital.
Yeah. Sir, I have 3, 4 questions. First question is, can you give us the exact figure of pledge income, what you made in the current quarter, given you made around INR 3.25 crores last quarter? So if you can share that number, it would be great, sir. That's my first question.
I'll just ask the CFO, Girish, to…
So pledge income is -- for the quarter, it is INR 3.57 crore.
Okay. Okay. And any specific reason -- do you believe that this is start seeing significant traction? Because after peak margin rules, everyone thought that this might be a potential big source of revenue. So -- which did not play out as expected. So any specific reason do you believe or our people are bringing the money which they intend to bring with the peak margin compliance, and therefore -- so the traction was not visible?
See, I think -- as I've said earlier, though we may see it in isolation, I think it should not be seen in isolation. It should be seen as a consolidated number with our transaction revenue as well as the pledge we place. It is a facility which will enable the transaction income as well as the overall transaction base of revenue which CDSL earns.It is -- it has become fairly popular in terms of pledge/repledge. Only our charges are far lower than the normal transfer, which we do for a pledge/repledge. So first leg, it is INR 5. But later on for repledge and release, it's INR 1. So this is to ensure that more and more people join the ecosystem, make it as a part and parcel of that.So I think the important thing is that we are seeing some good healthy numbers and that is growing, I think, probably every quarter-on-quarter. So more and more people are joining the queue.In terms of your early pain because of peak margin, yes, that will continuously change. Tomorrow, there may be some other rules, et cetera. So the important thing is that the CDSL has the requisite platforms to cater to the requirements as and when the market wants. And at least our focus has been that we keep our platform really up and running and whichever way the -- it's similar to basically a road, which is built. Whether you have cars running on it or the SUVs running on it or -- that depends on the -- it is a function of supply and demand.And I think that is what is our focus. We don't go after a particular line of business. We just kind of make sure that there is a ease for the client and customers, so more and more people can join our board.
Got it, sir. Sir, another question was basically the INR 28.8 crores of annual issuer charges. It will be great if you can break it down into listed and unlisted?
We don't give that numbers, unfortunately. I think the important thing is that it is continuing to grow. And most of it -- if you see quarter-on-quarter, more and more people, a new IPO is coming as well as new and unlisted companies, which are coming. So as per the current framework, we don't give out those numbers.
Okay. Okay, sir. And finally, on online data charges, I just wanted to understand the broader pie. How much eKYC, eSign and normal KYC or KRA income contribute? So I believe still the lion's share comes from normal KRA rather than coming from eKYC and eSign. And sir these new additions of lines coming from eSign will be significant or still the main KRA income will continue to be the major revenue generator for the data online income?
Unfortunately, we don't give any futuristic views. So I think we'll have to wait and watch.
But sir, if you can give the mix of on the data income into...
Again, we don't give that mix as per the current framework. This is the -- what we do like with -- I said that the earlier question also, we don't give the mix. So it's continuous.
Got it, sir. Sir, finally, on IPO income. So it is almost -- if you earn so much that it is equivalent to the last year's full year income almost closer to full year income in the current quarter to INR 21.5 crores. Sir, can you just tell us how much income a single IPO -- a big IPO can -- that means just wanted to understand the broad working. For every application, how much you charge then for allocating how much you charge? And finally, predicting it, how much you charge? Sir basically, just wanted to understand, given the pipeline is so high going ahead, just wanted to focus how the IPO income will play out in subsequent 2 quarters?
Yes. So I think we have to see. Because see again, of futuristic, we'll not be able to give on how many IPOs actually will hit the market. It's a formula-based approach and its objective-driven. So it depends on the number of folios, the number of the value. I'll ask Ramkumar to just give a broad framework on how it's charged.
Sir, as far as charging is concerned, there are 2 charges that one would have to pay as an issuer to the depository. First is in terms of applications, there is a verification charge, which is INR 1 per application, if I may put it that way. And then the second is for the credit, which was this INR 10 per record or for BOI. So these are the 2 charges that an issuer would have to pay for processing and IPOs.
The next question is from the line of Aalok Shah from Monarch Networth Capital.
Congratulations on excellent set of numbers.
Thank you.
I clearly understand that from what we hear on the con call that there are a lot of revenue drivers, which are in pipeline beating some of account aggregator or even the Gold Spot and then the payment bank opportunity. I mean, sir, would you be kind of talk about how these things could shape up from a near-term perspective? Maybe not nearly near term, it's 2 to 3 quarters, but from a 2 to 3 years' time frame. Certainly, from the fact that you are kind of a data pool, CDSL is more about data pool. So what could be the synergies that could play out for all of these opportunities?
So I think, overall, it's basically from a physical footprint to an electronic or a digital footprint is where the entire ecosystem is moving towards. And it is interconnectedness of various platforms, be it your eKYC, to eSign, to account opening, to transactions, to your consolidated account statements. So I think it's moving more towards a paperless kind of a platform.That kind of brings in a lot of stability that despite in COVID, as we've seen in the last 1.5 years. The business has not only been as usual but have seen some growth also. And I think that's the entire vision in which that we want to move away from a paper-based processing to a kind of an electronic-based processing.This kind of ensures that the entire system becomes the core and human beings become the support. And I think that's an important change in paradigm, which is happening fairly and rapidly to ensure that people are able to assess platforms and basic [ informations ] from the comfort of their homes also.And that's how it's going to kind of pan out, not only in the securities market but in the commodities market, in the spot commodities market. And I think the reforms which we are seeing in the securities market will kind of get extended to all these markets. And there's going to be some kind of linkage happening between these markets as we move forward about 2 or 3 years from now.
Sure. This helps. Sir, just quickly on the data keeping question. I missed out the numbers there. But the transaction revenue were INR 49.75 crores, and the IPO charges revenue was INR 21 crores?
Yes.
Okay. And the online data charges of INR 39 crores?
Online data was INR 30.28 crores.
[Operator Instructions] The next question is from the line of Franklin Moraes from Equentis Wealth Advisory.
Congratulations on a good set of numbers.
Thank you.
So I wanted to understand on the IFSC subsidiary, the one which we have recently started, what is the status like in terms of the revenues? And what is the kind of potential that we are seeing over there?
Yes. So we have made a disclosure sometime last month. And there is a consortium formed in the IFSC of the India INX, which is the BSE Exchange, the NSC, MCX, NSDL and CDSL. They're equal partners as part of the consortium. There has been an intrinsic agreement reached that is going only one single depository in the IFSC space both for securities and bullion. And that would be kind of a purchased by this consortium as we move forward.So it will -- I think as the products and platforms grow in there, both on the bullion side as well as on the security side, this will be the only single depository which is there. And CDSL will continue to be an equal partner as part of the consortium.
So by equal, you mean like we will be having about a 1/3 stake in this?
It will be -- we have 5 partners, about 1/5th.
Okay. Okay. And as of now, we are not generating any...
And that consortium would also own the entire ecosystem in the bullion. So it will be the exchange clearing corporation also. So it will not only be restricted to the depository business. It will also be in the revenues on the exchange and clearing corporation on the bullion side.
So as of now, the revenues would not be very material? Would that be correct?
Yes. It has not yet started giving any material revenues. You're absolutely right. And -- but there is a lot of promise as we move forward.
And in terms of the cost, you mentioned that technologies are backbone, and we expect to keep investing in technology and employees as well. Now considering that our income is running much ahead of what was the trajectory in the past few years. I expect that probably we would be spending incrementally a bit more on these avenues. Would that be a fair statement?
Yes. The important thing is that we continue to assess that the technology is in sync with the increasing business volumes, and the employees who are processing this business also is kind of adequate to ensure this. So it will, see -- probably in absolute numbers, it will go up. We'll have to wait and watch in terms of the percentage to revenue, whether it will go up or go down or remain constant.
So when we budget for these, do we budget them in absolute terms? Or do we have a percentage of revenue kind of metric for building in these costs?
I think that's more of a micro question for the management. But I think, important thing is that we want to ensure that we have adequate infrastructure to kind of -- both in terms of people and systems to kind of garner the business growth, which is kind of expected. And the scalability of the infra is also an important aspect that as and when business grows, we are able to really scale up also very quickly.
[Operator Instructions] The next question is from the line of Amit Chandra from HDFC Securities.
Sir, we have seen very healthy growth in the account addition, new account addition, and that has been like that has been sustaining since the last 2 years. But that was because we had exclusive agreement -- let's say with the discount brokers, right? But now the bank-owned brokers is also becoming and aggressive on the discount brokering side, and the price parity is somewhat coming down. So -- and with the bank-owned brokers, we don't have that exclusive agreement that we have with the online brokers. So -- like do we see that as a risk in terms of the healthy account additions that we are having, so that can slow down as like more and more brokers shift to the bank-owned brokers?
Yes. I think my intent as a management is to give the best-in-class platform and the value proposition, leave it to the market to decide. Even the discount brokers had and continue to have a choice of both the platforms. We have chosen to remain with one.And I think as long as you have -- you can provide that value proposition; you will leave it to the market to kind of take a call. So I'm not too worried about how the market shapes up. As long as we are able to give value proposition and basically the ease of doing business, you're going to see volumes and traction coming, at least that is the hope and wish.
[Operator Instructions] The next question is from the line of Sanketh Godha from Spark Capital.
Sir, only a data-keeping question. What is the regulatory cost and bad debt provisioning costs in the current quarter, which was not disclosed in the GIFT City?
I'll ask Girish to answer that.
So provision on doubtful debtors was around INR 3 crores. And with respect to the regulatory cost, the investor -- the contribution that we are supposed to make to IPF is INR 3.76 crore in this quarter, SEBI fees of roughly INR 64 lakhs, and incentive that we are supposed to pay to DPs as per SEBI circular is around INR 1.57 crore.
We'll take one last question, which is from the line of Paresh Sangani from Club Millionaire.
Okay. Nehal, most of the questions have been answered, especially on the account aggregator side. But I would want a query on how the government digital products are proceeding.
Yes. So basically, we are going to implement the Phase 2, but due to the COVID circumstances where people had to actually send in their certificates in couriers, post, et cetera, are not being available, it has been postponed. So now we'll have to actually wait and -- for the decision of the SEBI appointed committee. And once they inform us, I mean, we are ready to process those certificates which come.
As there no further questions from the participants, I now hand the conference over to the management for closing comments.
No. So I just wanted to state that all of you remain safe under these unprecedented times and wish you all the very best and wishing you and your family a very happy Diwali and a prosperous new year. Thank you.
Thank you. On behalf of Axis Capital Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.