NSE IPO soon? Exchange makes Rs 1,300 cr provisions for SEBI settlement in Q2 results

National Stock Exchange of India (NSE) appears to be all set to launch its much-awaited initial public offering (IPO) in coming months. The leading exchange has made provision of nearly Rs 1,300 crore for one-time settlement fees with the capital markets regulator SEBI in the co-location case. This will clear the major roadblocks in the exchanges' IPO, subject to necessary approvals.

NSE reported a 33 per cent fall on a year-on-year (YoY) basis in its consolidated net profit at Rs 2,098 crore, which included a given provision. Excluding this provision, its net provision stood at Rs 3,396 crore for the quarter. NSE's revenue from operations in the quarter under review stood at Rs 3,677 crore, down 18 per cent YoY.

Sandip Ginodia, CEO of Kolkata-based Altius Investech said that that results of NSE were in-line to the expectations amid the curbing the F&O trade volumes. "The provisioning for settlement clearly indicates that the company is fully prepared for the IPO in FY27 and we believe that issue may be launched by H1FY27," he said.

The settlement fee was a one-time hit on profitability. Going forward, we believe transaction revenue will be boosted by a gradual recovery in volumes and non-transaction revenue will maintain momentum, said Motilal Oswal Financial Services. However, the possibility of further tightening of F&O regulation remains a key risk. Overall, we expect a CAGR of 6 per cent/4 per cent/7 per cent in revenues/EBITDA/reported PAT over FY25-28."

NSE continues to focus on product innovation, with electricity and commodity derivatives witnessing significant traction and expected to meaningfully contribute in the long term. Its long-term growth trajectory remains intact, with a recovery in trading volumes, sustained leadership across market segments, a strong pipeline of primary market issuances and an expanding investor base.

Unlisted shares of NSE are currently trading at Rs 1,850-1,900 range, commanding a total market capitalization of Rs 4.58-4.70 lakh crore. The stock has been facing turbulence, falling nearly 23 per cent from its peak amid the falling volumes in the F&O segment, particularly after the weekly expiry was taken out of the picture.

NSE’s Q2FY26 performance was weighed down by a one-time Rs 1,300 crore provision related to the colocation and dark-fibre cases, leading to a 23 per cent YoY decline in net profit to Rs 2,100 crore, though underlying profitability remained healthy. NSE booked Rs 1,200 crore in investment gains from its NSDL divestment and now holds a 15 per cent stake, said Centrum Broking.

"Revenues fell across cash, equity futures and options, but long-term estimates still imply a 10 per cent revenue CAGR and 9 per cent profit CAGR over FY25-FY28E, with FY26 expected to be a reset year. Ebitda margins remained strong at 78 per cent. Market share in cash and futures remained dominant, though equity options share dipped to 75.6 per cent. Customer participation continued to expand, with new product launches being seen as positive," it added.

Finance Minister Nirmala Sitharaman on November 6 said the government is not here to shut the door on futures and options (F&O) trading. "Government is here to remove the roadblocks and work on them," said Sitharaman at the 12th SBI Banking and Economics Conclave 2025 in Mumbai. It is investors' responsibility to understand the associated risks, she added.

NSE continued to consolidate its leadership position across asset classes. For H1FY26, it maintained a 93 per cent market share in the cash market segment, 99.8 per cent in equity futures, and 77 per cent in equity options. NSE’s contribution to the exchequer stood at a substantial Rs 28,308 crore in H1FY26, reaffirming its key role in India’s financial ecosystem.