Valuation Drops With Revised Offer
The much-awaited initial public offering of the National Stock Exchange has undergone significant changes between its Draft Red Herring Prospectus and the revised offer documents, with the most notable change being a substantial reduction in the size of the share sale.
NSE has reduced its proposed offer-for-sale from 14.9 crore equity shares to 12.64 crore shares, representing a reduction of roughly 15%. Since the IPO consists entirely of an OFS, the lower number of shares directly reduces the overall size of the issue.
The revised price band has also been fixed at ₹1,700 to ₹1,785 per share. This is below the earlier expected price range of approximately ₹2,000 to ₹2,100 per share.
At the upper end of the new price band, the IPO is estimated to raise around ₹22,569 crore. At the lower end, the issue would raise approximately ₹21,494 crore.
The revised size places the NSE IPO among India’s largest public offerings. At ₹22,569 crore, it would rank second behind Hyundai Motor India’s ₹27,870-crore IPO launched in 2024. It would also surpass Life Insurance Corporation of India’s ₹21,000-crore IPO from 2022.
The lower price band and reduced share offering have also affected the exchange’s implied valuation. NSE is now valued at approximately ₹4.2 lakh crore based on the revised pricing, compared with an earlier estimate of around ₹5 lakh crore.
Shareholders Reduce Offers
The reduction in issue size is reflected in the revised sale plans of several existing shareholders.
State Bank of India has reduced its proposed sale from 2.47 crore shares to 1.6 crore shares. MS Strategic (Mauritius) has cut its offer from 1.6 crore shares to 1.1 crore shares.
Bank of Baroda has reduced its proposed sale from 1.09 crore shares to 76.9 lakh shares, while Stock Holding Corporation of India has lowered its offer from 1.08 crore shares to 61.87 lakh shares.
General Insurance Corporation of India has similarly reduced its proposed sale from 1.06 crore shares to 61.87 lakh shares. National Insurance Company has cut its offer from 60 lakh shares to 40 lakh shares, while Mahagony has reduced its proposed sale from 50 lakh shares to 30 lakh shares.
Some shareholders have retained their original proposed offers. Canada Pension Plan Investment Board continues to offer 1.18 crore shares, while Aranda Investments (Mauritius), New India Assurance Company and United India Insurance Company have retained offers of 1.12 crore, 1.05 crore and 60 lakh shares, respectively.
The revised documents also include SBI Capital Markets as a selling shareholder, which was not included in the original DRHP list.
NSE Will Not Receive IPO Proceeds
The NSE offering is entirely an offer-for-sale, meaning the exchange itself is not issuing fresh equity.
Consequently, NSE will not receive any proceeds from the IPO. The money raised will instead go to the existing shareholders selling their stakes.
The decision by some shareholders to reduce their offer size could be linked to the lower pricing. Some investors may prefer to retain a larger portion of their holdings if they believe they can achieve a better valuation by selling shares at a later stage.
The IPO is scheduled to open for subscription on September 17 and close on September 21. Anchor investor bidding is scheduled for September 16, while NSE shares are expected to debut on the stock exchanges on September 24.
The revised structure will make the IPO closely watched by investors, particularly given NSE’s position as one of India’s most important financial-market institutions and the scale of the proposed listing.
