KuberGrow Team The National Stock Exchange of India Ltd. (NSE) is making waves with its much-anticipated Initial Public Offering (IPO). The exchange, known for its dominance in the Indian capital market, is gearing up for a potential market debut that has investors eagerly waiting. While the dates, issue size, and price band remain under wraps, the public offering will be a book-built issue, with 11.14 crore shares up for grabs. These shares will be split into three categories: Qualified Institutional Buyers (maximum 50%), Non-Institutional Investors (minimum 15%), and Retail Individual Investors (minimum 35%).
The NSE’s position within India’s financial landscape is unparalleled. With a staggering 92.7% market share in cash equities, 99.9% in Equity Futures, and 96.9% in Equity Options, the exchange is the largest derivatives platform globally by trading volume. Additionally, it ranks third globally in cash equities based on the number of trades. The exchange also offers co-location facilities, catering to high-frequency traders, solidifying its position as a critical player in the world’s financial markets.
NSE’s financial trajectory is nothing short of impressive. From 2019 to 2024, the company saw its sales grow more than fivefold, surging from ₹3,027.79 crore to ₹16,433.61 crore. Over the same period, its net profit soared over fourfold, reaching ₹8,305.74 crore from ₹1,708.04 crore. These figures highlight NSE’s remarkable ability to scale its operations while maintaining an asset-light model. Notably, by FY24, its total assets had ballooned to ₹65,464 crore, up from ₹19,978 crore in FY19. The company’s diversified revenue model stands out, with transaction charges accounting for nearly 74% of its income.
However, like any major player, NSE has faced its share of legal challenges. The exchange has had to navigate complex issues surrounding co-location, dark fibre, corporate governance, and trading access points. Despite these hurdles, NSE has shown resilience. Recent rulings in its favor, such as the Securities Appellate Tribunal dismissing appeals against the company regarding governance matters, highlight its ability to move past legal obstacles. Furthermore, NSE has resolved regulatory issues by settling probes with SEBI, reinforcing its commitment to regulatory compliance.
In terms of valuation, the unlisted shares of NSE are currently trading at ₹1,800 per share, with reports indicating a much higher valuation on private trading platforms like WWIPL, where the shares are quoted at ₹7,300. Investors who acquired shares prior to the subdivision in November 2024 have seen significant gains, particularly after the exchange issued bonus shares, further fueling excitement in the market.
The key stakeholders in NSE include prominent domestic investors such as Life Insurance Corporation of India (LIC), which holds a 10.72% stake, and others like Stock Holding Corporation of India, Radhakishan Damani, SBI Capital Markets, and the State Bank of India, who all play a vital role in the exchange’s ownership structure.
Looking ahead, the growth prospects for NSE remain robust. The Indian economy continues to expand at an impressive pace, and the growing trend of digital adoption and financial inclusion is likely to further boost NSE’s role in India’s capital markets. The surge in retail investor participation, particularly in the wake of increasing market awareness, points to an even higher demand for new offerings. As India’s financial landscape evolves, NSE stands at the forefront, ready to capitalize on the country’s economic transformation and the increasing sophistication of its financial markets.
For investors, the upcoming NSE IPO represents a promising opportunity to tap into one of the most powerful financial institutions in India. As the market anticipates this offering, the potential for significant returns is palpable. With its strong financial performance, dominant market position, and promising future growth, the NSE IPO is certainly one to watch closely in 2025.
