India's NSE reapplies for SEBI approval for long-awaited public offering: Sources

The National Stock Exchange of India (NSE) has resumed its efforts to launch a public offering, a move that could result in one of the largest IPOs in the country, according to two sources with direct knowledge of the matter.

The exchange has submitted a fresh application for a "no-objection" certificate to the Securities and Exchange Board of India (SEBI), the sources revealed, speaking on condition of anonymity. NSE officials did not immediately respond to requests for comment.

NSE, recognized as the world's largest derivatives exchange by volume, first sought to go public in 2016. However, the process was derailed due to a protracted legal battle over equitable access for its trading members. In April 2019, SEBI imposed an 11 billion rupee fine on NSE for failing to ensure equitable access, which led to the regulator returning the exchange’s listing documents.

In June 2022, NSE made a renewed attempt to proceed with the IPO, but SEBI declined the application, citing unresolved legal and regulatory issues, according to a Reuters report from last year.

"The exchange is planning to offload 10per cent of its shares through the public offer, which could size the IPO around $3.2 billion," one of the sources said.

NSE is currently valued at approximately 2.7 trillion Indian rupees ($32.18 billion) in the "grey market." The IPO is expected to provide an exit opportunity for several of its existing shareholders, including Life Insurance Corporation of India, State Bank of India, Canada Pension Plan Investment Board, a Tiger Global fund, and a Morgan Stanley fund.

For the June quarter, NSE reported a 39 per cent year-on-year increase in consolidated profits, amounting to 25.67 billion Indian rupees, driven largely by the booming options trading market in India.

"Earlier this year, NSE management wrote to SEBI, seeking to resolve all pending legal and regulatory cases," the second source added, suggesting that the exchange is taking steps to clear the path for the IPO.