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Highlights
- The NSE, last week, appointed 20 merchant bankers, along with several law firms and other intermediaries, to manage its issue.
- Ranked as the global leader in derivatives trading, NSE often competes with NYSE and NASDAQ in transaction volume. However, the timing of the IPO coincides with a tightening regulatory environment.
- As the country’s leading exchange derives a substantial portion of its revenue from F&O trading, some market experts suggest the IPO might list at a discount compared to its current unlisted market premiums.
NSE IPO: The National Stock Exchange of India (NSE), the world’s largest derivatives exchange group by volume, is finally moving toward what is expected to be the largest Initial Public Offering (IPO) in Indian history.
Making a step towards its much-awaited listing, the NSE, last week, appointed 20 merchant bankers, along with several law firms and other intermediaries, to manage its issue.
NSE IPO: NSE to enter elite club of India’s top 10 most valuable companies
After a decade-long wait characterised by regulatory hurdles and intense scrutiny, sources indicate the exchange is aiming for a valuation exceeding Rs 5 lakh crore at the current unlisted price. With this market capitalisation, the company is expected to join the elite club of India’s top 10 most valuable companies.
Earlier in January this year, the Securities and Exchange Board of India (Sebi) granted a no-objection certificate (NOC), allowing the exchange to move ahead with its listing plans after more than a decade of delays.
In 2016, the NSE first filed draft offer documents to raise about Rs 10,000 crore through an offer-for-sale by existing shareholders. However, Sebi had withheld approval following governance concerns and the co-location case. Since then, the exchange approached the regulator multiple times seeking clearance.
Ranked as the global leader in derivatives trading, NSE often competes with NYSE and NASDAQ in transaction volume. However, the timing of the IPO coincides with a tightening regulatory environment.
The Union Budget 2026 introduced significant hikes in the Securities Transaction Tax (STT) on Futures and Options (F&O), with tax on futures rising to 0.05 per cent and options premium to 0.15 per cent.
These measures, combined with SEBI’s ongoing efforts to curb retail speculation in the derivatives segment, have raised concerns among analysts. As the country’s leading exchange derives a substantial portion of its revenue from F&O trading, some market experts suggest the IPO might list at a discount compared to its current unlisted market premiums.
NSE IPO: NSE appoints merchant bankers, law firms
Chaired by Srinivas Injeti, the exchange’s IPO committee approved the appointments at a meeting held on Thursday.
The development follows the NSE board’s decision in February to proceed with its long-pending public listing. The proposed IPO will consist entirely of an offer-for-sale (OFS) by existing shareholders, with no fresh issue of shares.
In a statement, NSE said the selection of intermediaries was carried out through a “structured, transparent and competitive process” based on an evaluation framework approved by the IPO committee.
Eight law firms have also been selected for the issue– Cyril Amarchand Mangaldas, Khaitan & Co, Latham & Watkins LLP, Sidley Austin Singapore Pte. Ltd., AZB & Partners, S&R Associates, Shardul Amarchand Mangaldas & Co and Trilegal.
Other intermediaries appointed include MUFG Intime India, Makarand M Joshi & Company, Manian & Rao, RBSA Advisors, Concept Communication and Redseer Strategy Consultants.
According to the exchange, these intermediaries will assist in regulatory filings, due diligence, documentation, marketing and execution of the proposed public issue, in line with applicable regulations.
With the completion of this process, the mandate of Rothschild & Co India as process advisor for the selection and appointment of NSE’s IPO intermediaries has concluded.
NSE IPO: NSE sets modest fee for its $2.5 billion IPO
The NSE has set advisory fees at about 0.65 per cent of the issue size for its upcoming initial public offering, Bloomberg News reported, as said by people familiar with the matter.
Based on an expected deal size of about $2.5 billion, the total fee pool could be about $16.25 million, with the bulk likely to be shared among the six lead banks, the people said, asking not to be identified because the information is private.
That compares with a roughly 1.86 per cent average paid by 417 companies last year and 1.67 per cent by 350 issuers in 2024, according to data from LSEG.
“Compared with large state-owned or public institutions, NSE’s fee payout appears relatively fair,” said Raghuram Kasiviswanathan, head of IPO advisory at Uniqus Consultech.
“With the exchange at the heart of the country’s capital markets, securing a role offers not just immediate revenue, but a longer-term strategic foothold,” he added.
(Disclaimer: The above article is meant for informational purposes only, and should not be considered as any investment advice. ET NOW DIGITAL suggests its readers/audience to consult their financial advisors before making any money-related decisions.)
