The Securities and Exchange Board of India (SEBI) has approved the joint venture agreement between Central Depository Services (India) Limited subsidiary Centrico Insurance Repository Limited and Shoveltech Solutions Private Limited. The regulator’s approval allows for the disbursement of ₹25,00,000 to develop a Minimum Viable Product (MVP) under the Software Development Partnership Agreement. This development marks a strategic step in expanding the company’s technology infrastructure within the insurance repository sector.

The approval was granted via letter no. HO/47/28/13(4)2026-MRD-RAC2/I/17525/2026 dated July 28, 2026. The transaction is subject to a specific regulatory condition: Central Depository Services (India) Limited must maintain its net worth requirement at all times on a standalone basis, in accordance with Regulation 14(1) of the SEBI (Depositories and Participants) Regulations, 2018. This condition ensures that the capital deployment for the MVP does not compromise the depository’s statutory financial health.

Transaction Details

Centrico Insurance Repository Limited, formerly known as CDSL Insurance Repository Limited, is a wholly-owned subsidiary of Central Depository Services (India) Limited. The partnership with Shoveltech Solutions aims to leverage specialized software development capabilities to enhance repository services. The disbursement of ₹25,00,000 represents the initial capital outflow for this collaborative effort.

What the Numbers Show

The conditional approval highlights the regulatory focus on capital adequacy in depository operations. By tying the ₹25,00,000 disbursement to the maintenance of standalone net worth requirements, SEBI ensures that operational expansion through joint ventures does not erode the core financial buffers required by Regulation 14(1) of the SEBI (Depositories and Participants) Regulations, 2018. This structure allows for technological innovation while preserving systemic stability.

Central Depository Services (India) Limited has been penalized ₹1 crore by the Securities and Exchange Board of India (SEBI) in connection with a malware incident that occurred on November 18, 2022. The regulatory action follows observations regarding cyber security and operational resilience frameworks at the depository. The penalty, amounting to ₹1,00,00,000, was imposed via a letter dated July 20, 2026, under Section 15HB of the SEBI Act, 1992 and Section 19G of the Depositories Act, 1996.

SEBI's order highlights specific lapses in the cyber security and operational resilience measures required under the applicable regulatory framework. The regulator initiated enforcement action after reviewing the incident's circumstances and the company's adherence to prescribed norms. The penalty serves as a monetary consequence for the identified contraventions related to the malware event.

Despite the regulatory sanction, Central Depository Services (India) Limited disclosed that there is no material impact on its financials, operations, or other activities. The company clarified that the only quantifiable monetary effect is the payment of the proposed penalty amount. The disclosure was made to the National Stock Exchange of India Ltd. in compliance with Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The following table summarizes the key details of the regulatory action:

The information was formally submitted by Nilay Rajendra Shah, Company Secretary & Compliance Officer of Central Depository Services (India) Limited. The company has also made the details available on its website.