What happened: NSE revives long-pending listing plans after regulatory nod
The National Stock Exchange (NSE) is preparing to restart its long-delayed initial public offering (IPO) process after receiving a go-ahead from the Securities and Exchange Board of India (SEBI), according to people familiar with the matter.
The exchange’s board is scheduled to meet on Friday to consider its December-quarter financial results. During the same meeting, it is expected to constitute a dedicated IPO committee, largely comprising independent directors, to steer the listing process.
People aware of the discussions said the committee will frame criteria for appointing merchant bankers and legal advisers who will help prepare and guide the filing of the draft red herring prospectus (DRHP). In market parlance, the DRHP is the formal IPO document submitted to the regulator.
NSE did not respond to an email seeking comment.
The move marks the most concrete step in years toward listing India’s largest stock exchange by trading volumes, after earlier attempts were stalled by regulatory scrutiny.
Why it matters: A listing could reshape India’s capital market landscape
An NSE listing would be one of the most closely watched capital market events in India, given the exchange’s central role in equities, derivatives and clearing infrastructure.
For policymakers and market participants, the listing is also seen as a test of regulatory closure on legacy issues, particularly the co-location and dark fibre cases that had clouded the exchange’s governance record.
A successful IPO could deepen transparency around the exchange’s financials and governance, while giving investors direct exposure to India’s market infrastructure story. Globally, several exchanges — including in the US and Europe — are publicly listed and operate as shareholder-owned entities.
At the same time, regulators have historically taken a cautious approach to exchange listings, given their systemic importance and regulatory responsibilities.
Also Read : Sensex and Nifty Rally on Trade Deal Optimism — But Is This Market Euphoria Built to Last?
What we know so far: OFS route, timeline targets and process details
Based on discussions with people familiar with the plans, several contours of the proposed IPO are emerging, though documentation is still in progress.
Key points include:
-
The proposed issue is expected to be primarily an Offer for Sale (OFS).
-
Around 4.5% of NSE’s equity may be offered.
-
At an estimated price of about Rs 2,000 per share, the issue size could be roughly Rs 23,000 crore, based on current unlisted market levels.
-
NSE MD & CEO Ashish Kumar Chauhan has indicated a preference for an OFS, with fresh issuance considered only if dilution targets cannot be met.
-
The exchange may target DRHP filing by March-end, using September-quarter audited numbers.
-
If timelines slip, filing could move to April with December-quarter audited numbers.
Regulations require that audited numbers in a DRHP should not be older than six months, shaping the filing window.
Once the IPO panel finalises selection criteria, shortlisted merchant bankers will be invited for formal pitches, often referred to in the industry as a “beauty parade.”
What remains unclear: Valuation, timing and regulatory fine print
Despite progress, several elements are not yet final.
Among the open questions:
-
Final valuation: Unlisted market prices provide a reference but are not binding.
-
Exact timing: Filing depends on readiness of documentation and audits.
-
Investor mix: Allocation between institutional and other investors is not yet clear.
-
Fresh issue component: It is conditional, not confirmed.
-
Regulatory conditions: Any additional SEBI observations could affect timelines.
People involved in the process said discussions are ongoing and details are awaited, underscoring that the plan is still subject to regulatory and board approvals.
Market impact: Limited immediate trading effect but high symbolic value
Since NSE is unlisted, there is no direct price reaction in public markets. However, the development is closely tracked by investors in listed exchange and financial infrastructure plays.
A potential NSE listing could influence valuations of other market infrastructure institutions over time, as investors reassess the earnings and growth potential of exchange businesses.
For now, participants say the impact is more symbolic, signalling regulatory comfort and policy closure rather than triggering immediate sector re-rating.
Broader context: A listing bid shaped by past regulatory hurdles
NSE’s path to listing has been unusually long. Its first serious attempt in 2016 was withdrawn as regulatory probes into co-location practices gathered pace.
The issue reached the Delhi High Court at one stage, with both NSE and SEBI named as parties. The regulatory overhang became a key reason for delays.
More recently, SEBI’s High-Powered Advisory Committee (HPAC) on Settlement had been viewed as a critical step before a no-objection certificate (NOC) could be issued. However, given prolonged timelines and in-principle consent from key SEBI departments, the NOC was granted without waiting for formal HPAC clearance, according to sources.
On June 20, 2025, NSE filed a settlement application with SEBI covering co-location and related matters. People familiar with the development said the exchange agreed to pay about Rs 1,400 crore toward settlement.
In November 2025 disclosures, NSE provided Rs 1,297 crore in addition to Rs 100 crore already deposited under a 2023 Securities Appellate Tribunal order.
What officials and market participants are saying
Officials have largely refrained from detailed public comment, given the sensitivity of exchange listings.
People familiar with the process say the current push reflects greater regulatory clarity compared to earlier years. They caution, however, that exchange IPOs involve additional scrutiny because exchanges function as both market operators and first-line regulators.
Merchant banking executives said interest is likely to be high if mandates are announced, given the scale and visibility of the transaction.
What it means for investors and shareholders
For existing shareholders, the IPO offers a potential liquidity event after years of holding unlisted shares. NSE’s shareholder base has expanded sharply in anticipation of a listing.
The exchange currently has about 1.91 lakh shareholders. The growth has been rapid:
-
Around 5,000 shareholders in December 2023
-
About 20,500 by December 2024
-
Roughly 1.84 lakh by December 2025
Because the issue is expected to be an OFS, NSE must communicate with shareholders and provide them an opportunity to participate in the sale. Market participants say this logistical exercise could be time-consuming.
For new investors, the IPO could offer exposure to a business model tied to India’s capital market growth, though final pricing and disclosures will shape demand.
What to watch next: Filings, banker appointments and regulatory observations
Investors and policy watchers will monitor several milestones:
-
Formation of the IPO committee after the board meeting
-
Criteria and appointment of merchant bankers and legal advisers
-
Timing of DRHP filing
-
SEBI’s observations on the draft document
-
Clarity on final OFS size and structure
Until a DRHP is filed and reviewed, timelines remain indicative. As with most large IPOs, the sequence from filing to listing can evolve based on regulatory feedback.
