Results

Document Summary

Price Waterhouse & Co Chartered Accountants LLP's review report addresses the Board of Directors of the National Stock Exchange of India Limited (NSE) regarding the consolidated unaudited financial results of NSE (the "Parent"), its subsidiaries (the "Group"), and its share of the net profit/(loss) after tax and total comprehensive income/(loss) of its associate companies. The review covers the quarter ended September 30, 2023, and the year-to-date results from April 1, 2023, to September 30, 2023, included in the consolidated unaudited financial results. The statement is submitted as per Regulation 33 of the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) Regulations, 2018 ("SECC Regulations") read with Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended ("Listing Regulations, 2015").

This statement is the responsibility of the Parent's Management and has been approved by the Parent's Board of Directors, prepared in accordance with recognition and measurement principles laid down in Indian Accounting Standard 34 "Interim Financial Reporting" ("Ind AS 34"), prescribed under Section 133 of the Companies Act, 2013, and other accounting principles generally accepted in India. Price Waterhouse & Co's responsibility is to express a conclusion on the statement based on their review. The review was conducted in accordance with the Standard on Review Engagements (SRE) 2410, issued by the Institute of Chartered Accountants of India, requiring the planning and performance of the review to obtain moderate assurance as to whether the statement is free of material misstatement. The review scope is substantially less than an audit and does not enable them to obtain assurance of all significant matters that might be identified in an audit; hence, they do not express an audit opinion.

The review report also considered procedures in accordance with SEBI regulations. The statement includes the results of subsidiary companies, including NSE Clearing Limited, NSE Investments Limited, NSE IFSC Limited, NSEIT Limited, NSE Data & Analytics Limited, NSE Indices Limited, NSE Infotech Services Limited, Aujas Cybersecurity Limited and TalentSprint Private Limited, along with associate companies like National Securities Depository Limited, Power Exchange India Limited, and Receivables Exchange of India Limited. The report states that nothing has come to their attention that causes them to believe that the statement has not been prepared in all material respects with the aforesaid Indian Accounting Standard and other accounting principles generally accepted in India.

The review report draws attention to Note 3 regarding orders passed by SEBI related to preferential access to tick-by-tick data at the Parent's Colocation facility, Dark Fiber point-to-point connectivity, and Governance, including Adjudication Orders. The Governance related matters and the Adjudication Matters relating to the Governance related matters continue to be under appeal before the Hon'ble Securities Appellate Tribunal ("SAT"). The Parent has received favourable orders from the Hon'ble SAT for the Colocation matter and the Dark Fiber matter as per orders dated January 23, 2023, and August 09, 2023, respectively. Subsequent to the SAT orders on the Colocation and the Dark Fiber matters, SEBI has filed two separate appeals before the Hon'ble Supreme Court, which are pending to be heard. The future outcome of these matters is uncertain at this stage. Except for a penalty amount of Rs. 100 crores, no provision for any liability has been recognized towards the above matters. The conclusion is not modified in respect of the matters.

The interim financial information of one subsidiary and consolidated interim financial information of two subsidiaries included in the consolidated unaudited financial results, whose interim financial information reflect total assets of Rs. 38,012.47 crores and net assets of Rs. 5,206.40 crores as at September 30, 2023 and total revenues of Rs.665.65 crores and Rs. 1,107.82 crores, total net profit/(loss) after tax of Rs. 449.17 crores and Rs. 683.36 crores and total comprehensive income / (loss) of Rs 449.75 crores and Rs. 680.85 crores, for the quarter ended September 30, 2023 and for the period from April 1, 2023 to September 30, 2023, respectively, and cash flows (net) of Rs. 19,717.07 crores for the period from April 1, 2023 to September 30, 2023, as considered in the consolidated unaudited financial results. These interim financial information have been reviewed by other auditors on which they have issued an unmodified conclusion.

The consolidated unaudited financial results also includes the interim financial information of one subsidiary which have not been reviewed/audited by their auditors, whose interim financial financial information reflect total assets of Rs. 0.33 crore and net assets of Rs. 0.31 crore as at September 30, 2023 and total revenue of Rs.* crore and Rs. 0.01 crore, total net profit/ (loss) after tax of Rs. * crore and Rs. (0.01) crore and total comprehensive income / (loss) of Rs. * crore and Rs. (0.01) crore for the quarter ended September 30, 2023 and for the period from April 1, 2023 to September 30, 2023, respectively, and cash flows (net) of Rs. (0.03) crore for the period from April 1, 2023 to September 30, 2023, as considered in the consolidated unaudited financial results. The unaudited consolidated financial results do not include Group's share of total comprehensive income/ (loss) in respect of two associates in which investment of Rs. 21.62 crores made by the Group has been fully impaired. According to the information and explanations given to us by the Management, these interim financial information are not material to the Group. Their conclusion on the Statement is not modified in respect of the above matter.

Statement of Consolidated Unaudited Financial Results:

The results for the quarter and half-year ended September 30, 2023, show a total income of ₹4,023.15 crores, comprising revenue from operations (₹3,651.78 crores) and other income (₹371.37 crores). Total expenses, excluding contribution to Core Settlement Guarantee Fund (Core SGF), amounted to ₹859.45 crores, resulting in a profit before exceptional items, Core SGF contribution, associates' net profits, and tax of ₹3,163.70 crores. After accounting for the share of net profits of associates (₹25.51 crores), the profit before exceptional items, Core SGF, and tax was ₹3,189.21 crores.

After the payment for NSE Clearing Limited for Rs. 22.88 crores, the profit after exceptional items before Core SGF and Tax reached ₹3,189.21 crores. A further contribution to the Core SGF of ₹(560.18) crores results in a profit before tax from continuing operations of ₹2,629.03 crores. After deducting income tax expense (₹617.10 crores), the profit for the period from continuing operations was ₹2,011.93 crores. Discontinued operations incurred a loss of ₹(13.32) crores, leading to a total profit for the period of ₹1,998.61 crores. Other comprehensive income resulted in a loss of ₹(9.48) crores, bringing the total comprehensive income for the period to ₹1,989.13 crores. The results include earnings per equity share of ₹40.38 from continuing and discontinued operations, attributable to the owners of the National Stock Exchange of India Limited.

Segment Information includes details on Trading Services, Clearing Services, Strategic Investments, and Other Segments. For the quarter ended September 30, 2023, Trading Services recorded segment revenue of ₹3,371.13 crores and segment results of ₹2,635.69 crores; Clearing Services had revenue of ₹278.22 crores and results of ₹22.68 crores; Strategic Investments showed revenue of ₹18.89 crores and results of ₹(0.73) crores; and Other Segments generated revenue of ₹152.83 crores and results of ₹50.02 crores. Total assets were ₹38,341.52 crores, with unallocable assets of ₹20,555.55 crores and total assets of ₹59,718.90 crores. Core SGF contributions were specified.

Condensed Consolidated Balance Sheet (September 30, 2023):

The assets include non-current assets of ₹17,361.73 crores (including property, plant and equipment, investments, and other financial assets) and current assets of ₹41,535.34 crores. Assets classified as held for sale amount to ₹821.83 crores. Total assets are ₹59,718.90 crores. Equity attributable to the owners of the National Stock Exchange of India Limited is ₹20,310.22 crores. The Settlement Guarantee Fund totals ₹6,254.92 crores. The liabilities include non-current liabilities of ₹509.80 crores and current liabilities of ₹32,644.46 crores, resulting in total liabilities of ₹33,154.26 crores.

Cash Flow Statement:

Net cash inflow from operating activities was ₹26,535.91 crores, net cash outflow from investing activities was ₹(2,669.19) crores, and net cash outflow from financing activities was ₹(4,044.42) crores. This resulted in a net increase in cash and cash equivalents of ₹19,822.30 crores, with cash and cash equivalents at the end of the period totaling ₹25,796.95 crores.

Additional Notes:

Discontinued operations relate to the Education and Technology Business. NSE's trading system was halted on February 24, 2021, due to issues with telecom service providers. SEBI mandated financial disincentives and issued show cause notices. Voluntary contribution was made to the Core Settlement Guarantee Fund. NCL’s Core SGF details are provided and NSE has provided corporate guarantee to the Standard Chartered Bank for NSE IFSC operations.