The National Stock Exchange of India (NSE), which operates the world's largest derivatives exchange by trading volume, is poised to launch formal marketing for its initial public offering (IPO) as early as next week. The exchange is targeting a September listing for what could be one of the country's largest IPOs, potentially raising $3 billion. Investor meetings are planned across the US, London, Singapore, Hong Kong, the Middle East, and India.
This IPO follows a decade-long delay due to a co-location controversy and regulatory challenges, including curbs on derivatives trading that impacted NSE's revenue and market share. While NSE's revenue declined by 3% in the last fiscal year, it still generates nearly six times the revenue of its peer, BSE Ltd. NSE's market share remains high in equity futures (100%), cash market (93%), and equity options (75%).
NSE aims to pitch the IPO to over 30 global investors this month, highlighting India's rapid financial expansion and growing capital market participation. The exchange projects annual turnover growth of 12% in cash equities and equity futures, and 10% in equity options over the next five years. The offering will consist entirely of existing stock, with up to 148.9 million shares on offer, representing about 6% of the company. The estimated valuation in the gray market exceeds $52.9 billion, which could lead to a $3.2 billion raise, potentially surpassing Hyundai Motor Co.'s Indian unit IPO two years ago. The last leg of investor roadshows will include the US, UAE, and London next month.
