Udyog Suvidha Kendra
Share Services

Demat of Shares
Go Digital, Secure & Fast.

Convert your physical share certificates into secure digital holdings. Mandatory for most transactions, dematerialisation ensures safe and paperless share management in compliance with SEBI and MCA regulations. We simplify the process end-to-end.

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Overview

What is Demat of Shares?

Dematerialisation, commonly known as Demat of Shares, refers to the process of converting physical share certificates into electronic format. This transition allows shareholders to hold and trade shares digitally through a Demat account, eliminating the risks associated with physical documents like damage, theft, or forgery. In today's digitised financial ecosystem, dematerialisation is not just a convenience—it's a necessity for faster, safer, and more efficient trading and record-keeping.

Demat shares are stored with Depository Participants (DPs) under central depositories such as NSDL (National Securities Depository Limited) and CDSL (Central Depository Services Limited), offering enhanced transparency and regulatory control. Whether you're an investor, company director, or legal heir, understanding and opting for Demat is crucial for seamless ownership and compliance.

Faster
Instant electronic transfers.
Safer
No risk of physical loss.
Mandatory
For trading & transfers.
Transparent
Easy tracking & audit.
Demat Overview Illustration
Value Proposition

Meaning and Importance

Demat of shares enables investors to securely manage their securities without the hassles of physical certificates. The key importance includes:

Eliminates Physical Risks

No worries about loss, damage, or tampering.

Faster Transactions

Instant electronic transfers instead of days of paperwork.

Essential for Liquidity

Mandatory for trading on stock exchanges.

Boosts Transparency

Easy tracking, minimal fraud, and audit-ready records.

Investor-Friendly

Simplified portfolio management and corporate actions (dividends, splits, etc.).

For both public and private companies, maintaining shares in Demat form boosts credibility, simplifies compliance, and makes future transactions more streamlined.

When Required

When is Dematerialisation Required?

Dematerialisation of shares is an essential process that can be required in specific situations. Whether for regulatory compliance or convenience, the following scenarios outline when you need to dematerialise your physical shares.

1. Mandatory for Listed Companies

As per SEBI guidelines, listed companies are required to maintain shares only in electronic (demat) format. Physical share certificates are no longer valid for sale or transfer on stock exchanges. This requirement ensures regulatory compliance, eliminates risks of loss or forgery, and makes trading seamless and secure.

1. Mandatory for Listed Companies

2. Voluntary for Shareholders of Unlisted Companies

Shareholders holding physical shares in private or unlisted companies can voluntarily choose to dematerialise their holdings. While not mandatory, converting to demat is highly recommended to simplify record-keeping and avoid issues during future transfers. Many companies encourage demat to enhance transparency and ease of corporate actions.

2. Voluntary for Shareholders of Unlisted Companies

3. Before Selling or Transferring Physical Shares

If you plan to sell, gift, or transfer physical shares, dematerialisation becomes mandatory. Depositories and companies no longer process requests based on physical certificates. Demat conversion ensures a legally valid, faster, and more efficient transaction process.

3. Before Selling or Transferring Physical Shares

Eligibility

Who Needs to Convert Physical Shares to Demat?

Dematerialisation is not only a legal requirement but also a practical necessity for those holding physical share certificates. It simplifies trading, enhances security, and ensures you stay compliant with regulations.

Shareholders Holding Physical Share Certificates

If you hold paper share certificates, it's important to convert them to demat to ensure security, compliance, and ease of transfer.

  • Mandatory for trading: You cannot sell, transfer, or pledge physical shares without converting them to demat form.
  • Safety: Demat eliminates the risk of loss, theft, or damage to physical certificates.
  • Corporate actions: Allows participation in corporate benefits like dividends, bonuses, and stock splits seamlessly.

Shareholders Holding Physical Share Certificates

Legal Heirs of Deceased Shareholders

Legal heirs of deceased shareholders must convert inherited physical shares into demat for proper legal documentation and to access benefits.

  • Legal ownership: Dematerialisation helps confirm legal ownership, enabling the heir to claim dividends, rights, and other benefits.
  • Required documents: The process generally requires a death certificate, succession certificate or will, and identity proof of the legal heir.

Legal Heirs of Deceased Shareholders

Investors Planning to Trade or Transfer Shares

If you intend to trade, transfer, or gift your shares, converting to demat is essential for smooth transactions.

  • Trading: Stock exchanges require shares to be in demat form for listing, trading, and clearing.
  • Transfer: Shares can only be transferred electronically in demat form, making the process faster and more secure.
  • Pledging shares: Demat accounts allow shares to be pledged for loans or other financial transactions.

Investors Planning to Trade or Transfer Shares

Checklist

Required Documents

To ensure smooth and legally valid dematerialisation of physical share certificates, the following documents are required. These ensure the identity of the shareholder, ownership proof, and KYC compliance:

Dematerialisation Request Form (DRF)

Filled and signed form submitted to the Depository Participant (DP) for converting physical shares to demat.

Original Share Certificates

Physical certificates of shares being dematerialised, marked as “Surrendered for Dematerialisation”.

Client Master Report (CMR)

Issued by the DP, it contains your Demat account details like DP ID, client ID, and PAN.

Self-Attested PAN Card

Mandatory identity proof for all shareholders involved in the demat process.

Address Proof

Aadhaar, passport, voter ID, or utility bill (not older than 3 months) for verifying residential address.

Passport Size Photograph

May be required by the DP to complete KYC formalities.

Death Certificate (if applicable)

Required when dematerialising shares held by a deceased shareholder.

Legal Heir/Succession Certificate (if applicable)

Submitted along with the death certificate to establish ownership rights.

Power of Attorney/Board Resolution (if applicable)

Needed if the process is being handled by an authorised representative or on behalf of a company.

Step-By-Step

Execution Process for Dematerialisation of Shares

Converting physical share certificates to digital form is now essential for seamless trading and compliance. Here’s a simplified and structured guide to help you through the dematerialisation process:

1

Open a Demat Account with a Depository Participant (DP)

Start by choosing a SEBI-registered Depository Participant (DP) such as a bank, stockbroker, or financial institution.

  • Submit your KYC documents (PAN, Aadhaar, proof of address).
  • Sign the agreement and receive your Demat account number (Beneficiary Owner ID).
2

Fill and Submit Dematerialisation Request Form (DRF)

Get the Dematerialisation Request Form (DRF) from your DP and enter details of each physical share certificate.

  • Ensure your name matches the certificate and the Demat account.
  • Sign the form as required.
3

Submit Original Share Certificates to DP

Attach the original physical share certificates with the DRF. Mention “Surrendered for Dematerialisation” on each certificate.

  • Ensure certificates are not torn, defaced, or disputed.
4

DP Forwards Request to Registrar

Your DP will verify the documents and forward them to the depository (NSDL/CDSL) and the company’s registrar for final verification.

5

Verification and Approval

The company registrar cross-verifies the physical share details with company records and informs the depository to credit shares.

✓

Shares Credited to Your Demat Account

Upon successful verification, shares are credited electronically and you receive a transaction statement from your DP as proof.

Pricing & Timeline

Timeline and Government Charges

Understand the complete timeline for dematerialisation and get clarity on applicable charges. Know how long the process takes, what fees may be charged by your DP, and how to avoid processing issues.

Dematerialisation Timeline Illustration

How Long Does It Take?

Typically 7 to 21 working days.

The dematerialisation process typically takes 7 to 21 working days, depending on how quickly the documents are verified by the Depository Participant (DP), the depository (NSDL/CDSL), and the Registrar and Transfer Agent (RTA). Any discrepancies in the application or documents can lead to delays. It's important to ensure all forms are correctly filled and all necessary documents are submitted upfront to avoid processing issues.

Fee Structure

Charges by Depository Participants

While the SEBI regulations do not mandate fixed charges, most DPs levy nominal fees for processing dematerialisation. Here’s what you may expect:

Dematerialisation Fee

₹5 to ₹25 per certificate (varies by DP)

Courier or Handling Charges

₹50 to ₹100 (if applicable)

Account Maintenance Fee

Charged annually by some DPs for maintaining your Demat account

Charges Illustration

Note: Some DPs offer free or discounted demat services under promotional offers or zero AMC (Annual Maintenance Charges) plans.

Common Issues

Common Issues During Demat and How to Avoid Them

Common Issues to Avoid

Signature Mismatch or Missing Documents

Signature mismatch between share certificates and the Demat request form (DRF) is a common reason for rejection. Ensure your current signature is updated with the company registrar. Always double-check and attach all required documents while submitting your DRF.

Invalid or Torn Share Certificates

Old or damaged share certificates often get rejected. If certificates are torn, faded, or illegible, apply for duplicate certificates from the issuing company before proceeding with the Demat process to avoid unnecessary delays.

Name Mismatch Between Certificate and PAN

If your name appears differently on the share certificate and PAN card (e.g., spelling errors, missing initials), your Demat request may be rejected. Provide a notarized affidavit, name change proof, or additional ID documents to reconcile discrepancies.

Why USK?

How Udyog Suvidha Kendra Helps

We simplify the Demat of Shares process with end-to-end support, quick verification, and transparent pricing.

1

End-to-End Demat Assistance

From opening a Demat account to coordinating with DPs and registrars, we manage the entire dematerialisation journey. Our team ensures proper documentation, error-free filing, and status tracking till completion.

2

Quick Verification & Submission Support

We help you validate documents, match signatures, and compile all necessary paperwork. With our expert assistance, common errors are avoided, and your Demat request gets processed without rejection or delay.

3

Affordable and Transparent Pricing Plans

Our service plans are designed to suit all investor categories, with zero hidden charges. Whether you're a first-time investor or handling inherited shares, we offer reliable support at a cost-effective price.

Support

Frequently Asked Questions

Find answers to common questions about the dematerialisation process, documents, and compliance requirements.

Demat of Shares in Different States

Andhra Pradesh Arunachal Pradesh Assam Bihar Chhattisgarh Goa Gujarat Haryana Himachal Pradesh Jharkhand Karnataka Kerala Madhya Pradesh Maharashtra Manipur Meghalaya Mizoram Nagaland Odisha Punjab Rajasthan Sikkim Tamil Nadu Telangana Tripura Uttar Pradesh Uttarakhand West Bengal Delhi Chandigarh Ladakh Lakshadweep Puducherry Jammu & Kashmir Andaman & Nicobar Dadra & Nagar Haveli

Demat of Shares in Major Cities

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