Demand for NSE’s anchor book is unexpectedly large: MD Ashish Chauhan
SYED BASHARAT
NEW DELHI, Sep 15: The much-awaited initial public offering (IPO) of the National Stock Exchange (NSE) is entering its final pre-launch phase with the country’s largest stock exchange preparing to open its public issue for subscription on September 17, in what is expected to be one of the most closely watched market offerings in recent years.
The IPO comes at a significant juncture for India’s capital markets, as the NSE seeks to transition into a listed entity while its existing shareholders look to monetise a portion of their holdings through an offer for sale. The issue is expected to bring the exchange, which has played a central role in the expansion of India’s securities market over the past three decades, under much closer public-market scrutiny.
The exchange has fixed a price band of ₹1,700 to ₹1,785 per equity share, with the issue scheduled to remain open until September 21. The shares are proposed to be listed on the BSE on September 24, making the listing structure itself an unusual feature of the offering.
Unlike companies that raise fresh capital through an IPO, NSE will not receive funds from the sale. The offering is entirely an offer for sale (OFS), under which existing shareholders will sell up to 12.64 crore equity shares. The proceeds will therefore accrue to the selling shareholders rather than being added to NSE’s balance sheet.
At the upper end of the price band, the issue is expected to raise approximately ₹22,561.5 crore, placing NSE’s implied valuation at around ₹4.42 lakh crore. The size of the offering has been reduced from the 14.89 crore shares proposed in the draft red herring prospectus filed earlier this year.
The IPO has received regulatory approval from the Securities and Exchange Board of India (Sebi), clearing the way for the exchange to proceed with its public issue.
The shareholder group participating in the OFS includes several major financial institutions and investment entities, among them State Bank of India, Bank of Baroda, General Insurance Corporation of India, Canada Pension Plan Investment Board, Aranda Investments (Mauritius) and MS Strategic (Mauritius), along with other existing investors.
One of the most closely watched developments ahead of the issue is the response from institutional investors. The anchor portion of the IPO, estimated at around ₹6,250 crore, is scheduled to open for institutional participation for one day on September 16, a day before the public subscription begins.
The strong institutional appetite is being viewed as an important early indicator of investor interest in the offering. The anchor allocation will be distributed among different institutional categories under the prescribed regulatory framework, with foreign portfolio investors, domestic mutual funds and other eligible institutions participating within their respective allocation limits.
The issue will subsequently move into the broader book-building process. Qualified institutional buyers will have up to 50 per cent of the issue reserved for them, while non-institutional investors will receive not less than 15 per cent and retail individual investors not less than 35 per cent.
For retail investors, the minimum bid has been fixed at eight shares, with subsequent bids required to be placed in multiples of eight. NSE has also made a provision for its employees, with shares worth up to ₹70 crore reserved for eligible employees and a discount of ₹170 per share on the final issue price.
The proposed listing structure has attracted particular attention because NSE’s shares will be traded on the BSE rather than on NSE itself. This arrangement stems from the regulatory principle that a stock exchange cannot effectively supervise and regulate its own listed securities.
The structure also has a precedent. When BSE became a listed company in 2017, its shares were listed on NSE, thereby ensuring that the exchange remained subject to oversight by another recognised stock exchange.
For investors, the NSE IPO represents an opportunity to gain exposure to the business infrastructure underpinning a substantial part of India’s equity and derivatives markets. NSE’s operations extend well beyond conventional equity trading, encompassing equity, equity derivatives, currency derivatives, commodities, interest-rate products, electricity-related markets, indices, market data and other financial-market services.
The exchange’s expanding product portfolio could become an important component of its longer-term growth strategy. Newer areas such as electricity futures, commodity derivatives and bond-related products are expected to create additional avenues for diversification, subject to regulatory clearances and market adoption.
The NSE International Exchange has also emerged as another component of the group’s broader operations. Its growing activity in international markets adds another dimension to NSE’s business beyond its dominant domestic franchise.
NSE’s financial performance provides another important backdrop to the IPO. Revenue from operations stood at approximately ₹4,560 crore in the quarter ended June 2026, compared with ₹4,032 crore in the corresponding period of the previous year. Net profit increased to around ₹3,121 crore, from ₹2,811 crore a year earlier.
The exchange’s investor ecosystem has also expanded dramatically. The number of unique registered investors increased from about 3.09 crore in March 2020 to 13.24 crore by June 2026, representing a compound annual growth rate of more than 26 per cent.
As of June 30, 2026, NSE had around 26.14 crore registered investor accounts, 1,328 trading members and more than 3,000 listed entities. Its investor footprint has extended to virtually every part of the country, reflecting the rapid expansion of retail participation in India’s financial markets.
The figures underline a broader transformation in India’s investment landscape. Equity-market participation, once concentrated largely among investors in major metropolitan centres, has increasingly spread into smaller cities and towns as digital trading platforms, online account opening and greater financial awareness have lowered the barriers to market participation.
NSE’s platform has simultaneously become a critical mechanism for capital mobilisation by Indian companies. During the quarter ended June 2026, more than ₹6.19 trillion was raised through its platform, while total fund mobilisation during financial year 2025-26 stood at about ₹20.33 trillion.
Equity capital mobilisation accounted for more than ₹1.29 trillion during the June quarter and approximately ₹4.78 trillion during FY2025-26, highlighting the exchange’s wider role in connecting companies seeking capital with investors.
Another important feature of NSE’s business is its dependence on trading activity, particularly derivatives. Weekly options have become a substantial contributor to the exchange’s income, while index services, data services and other market-related activities provide additional revenue streams.
The company’s prospects, however, remain closely linked to market conditions. Periods of subdued or range-bound market activity can affect trading volumes and consequently transaction-linked revenue. Conversely, stronger market participation, increased volatility and the introduction of new products can provide opportunities for higher activity.
The broader macroeconomic environment therefore remains an important factor for investors assessing the exchange’s future earnings trajectory. India’s continuing economic expansion, rising household participation in financial markets and increasing formalisation of savings are among the structural factors that could support the country’s capital-market ecosystem over the longer term.
At the same time, global geopolitical developments, changes in international monetary conditions and shifts in investor risk appetite remain potential sources of volatility for financial markets.
The IPO also comes as Indian regulators continue to refine the architecture governing market trading. Proposed changes concerning the Closing Auction Session (CAS) and other aspects of the cash-market framework could influence how trading takes place, although the eventual impact will depend on the regulatory decisions and their implementation.
For NSE, the ability to introduce new products remains closely tied to regulatory approvals. This means that future diversification cannot be assessed solely on the basis of the exchange’s technological capabilities or stated product pipeline; regulatory policy and actual investor participation will remain equally important.
The exchange’s technological infrastructure is another central element of its competitive position. Its ability to process enormous numbers of orders at extremely low latency has been a defining feature of the NSE model since its inception. The scale of its operations has grown alongside the digitisation and rapid expansion of India’s financial markets.
The transformation is particularly striking when viewed against the exchange’s early years. From a relatively modest trading operation in the 1990s, NSE has evolved into one of the world’s largest electronic market platforms, serving hundreds of millions of investor accounts and facilitating trading across multiple asset classes.
The upcoming listing will therefore represent more than a conventional corporate IPO. It will provide public-market investors with an opportunity to participate in the ownership of one of the most important pieces of India’s financial-market infrastructure.
For existing shareholders, the OFS offers a route to realise part of their investment. For institutional and retail investors, meanwhile, the central question will be whether NSE’s dominant market position, strong profitability, expanding investor base and potential for future product diversification justify the valuation implied by the IPO price.
With the anchor allocation set to provide the first major indication of institutional appetite on September 16, attention will then shift rapidly to the public subscription beginning on September 17. The response across institutional, non-institutional and retail categories will be closely watched as the exchange moves towards its scheduled BSE debut on September 24.
