Francis Mascarenhas | Reuters
The IPO will be entirely an offer for sale, with many large domestic and foreign investors paring their stake.
India’s largest public sector bank, State Bank of India, Canada Pension Plan Investment Board, and Singapore’s Temasek are among the 10 investors selling stake via the IPO.
Details regarding the pricing of the IPO and valuation have not been disclosed in the draft papers. The issues usually take two to three months, as per market experts, to get clearance from India’s capital market regulator.
India is among the top 10 equity markets globally with a total market cap of around 474 trillion rupees ($5 trillion), and NSE is the main exchange. It commands 93% share of India’s cash market and makes up nearly 100% of the country’s equity futures trading, with about 75% share in equity options trading, according to the draft IPO filing.
NSE, which has been trying to list since 2016, has over 129 million unique registered investors.
NSE’s Indian competitor, much smaller in terms of trading volume, BSE has a market cap of $17.2 billion and trades at a price to earnings of 66 times on trailing 12-month basis.
The IPO activity in India has been subdued as investor appetite has weakened amid the fallout from the Middle East conflict. Many big public issues have been kept on hold, but with the Iran war showing signs of ending, IPO activity is resuming.
Indian billionaire Mukesh Ambani’s Reliance Jio Infocomm, which is India’s largest wireless operator, is also expected to file papers for a public issue of $4 billion on or before June 19, according to a report from the Financial Times on Wednesday.
With an estimated combined fundraising of over 600 billion rupees (over $6.3 billion), NSE and Reliance Jio IPOs alone could account for nearly one-third of the total fundraised through 104 mainboard IPOs last year, said Prashant Rao, director and head, equity capital markets at Anand Rathi Investment Banking.
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