CDSL\u2019s stable revenue base driven by repeat business in multiple offerings across DP\u2019s, corporates, capital market intermediaries, insurance companies and others has enabled the company to clock 18%+ CAGR top-line growth over FY14-FY17. Fixed cost model driven primarily by staff and IT costs enables the company to register strong margins in tandem with revenue growth. High FCF generation (FCF yield \u2013 c.3%+), stable dividend policy (40%) and a strong balance sheet (net cash \u2013 R550 crore+) provide further support. We forecast a 22% EPS CAGR over FY17-FY20E and value the stock at 30x FY20E (premium to exchanges given subdued risk profile) to arrive at a fair value of Rs 450\/share, implying an upside of 25%+. Management\u2019s commitment to further increase dividend payment is a pre-requisite for stock re-rating. Initiate with \u2018BUY\u2019. CDSL has a high stability of operating income from the fixed annual charges collected from its diversified client base. Dematerialisation services for securities to DP, non-cash corporate actions such as bonus issue, splits provided to corporates, KYC services in respect of investors in Indian capital market, e-holding of insurance policies, e-voting, e-locker, and academic depository provide diversified rich annuity-based stable revenue to the company. The company has clocked an 18%+ CAGR top-line over the past four years. CDSL commands a 44% share in Demat accounts. CDSL operates in a largely fixed operating cost environment, wherein employee expenses and software development\/maintenance costs constitute c.57% of its total costs. In FY16, Sebi revised the percentage of contribution to Investor Protection Fund (IPF) from 25% of profit before tax (excluding other income) to 5% with retrospective effect.