Protean eGov Technologies has been grabbing headline space lately after the company didn’t qualify for the Income Tax department’s PAN 2.0 project. This resulted in a sharp fall in Proten eGov’s stock price. But we are going to let you in on a little secret. Do you know Protean eGov has a very old connection with NSDL?
Protean eGov’s surprising link to NSDL
Actually, Protean eGov was the original NSDL. Protean eGov was originally incorporated as National Securities Depository. It operated as a company providing depository services. It was engaged in services like setting up a tax information network for the income tax department and a Central Recordkeeping Agency for the Pension Fund Regulatory and Development Authority.
Then, in 2012, National Securities Depository Ltd. (today’s Protean eGov) filed for a scheme of arrangement with the Bombay High Court to reorganise and segregate its depository business via demerger. All the business related to the depository was transferred to NSDL, which was its former subsidiary. The demerged entity was named NSDL Depository Ltd.
Naming change
National Securities Depository (Protean eGov) was renamed to ‘NSDL e-Governance Infrastructure, which was later renamed to ‘Protean eGov Technologies. Simultaneously, the subsidiary, ‘NSDL Depository,’ was also renamed to what we know as ‘National Securities Depository Ltd.’ (NSDL).
However, NSDL said that it is neither associated nor related to Protean eGov in any manner, as per its DRHP. Adding to that, NSDL explicitly stated that its business is substantially different from that of Protean eGov, and currently, there is no similar business activity carried out by both companies.
Nonetheless, NSDL recognises that the public and external parties may continue to link NSDL or its operations with Protean eGov.
NSDL-Protean eGov business link
Despite the demerger and non-association with each other, NSDL continued to engage with Protean eGov for Aadhaar authentication services and electronic online signature services. Similarly, Protean eGov also engaged with NSDL for account verification services.
All in all, NSDL was once a subsidiary of Protean eGov Technologies. Its core depository business was demerged from Protean eGov. While they are now separate entities with distinct businesses, they still maintain some operational interactions.
Protean eGov stock performance
The share price of Proten eGov Tech has fallen 3.5% in the last five trading days. It has erased 28% of investors’ wealth in the past one month and 35% in the previous six months.