NSDL IPO in July? Here's what to expect

National Securities Depository (NSDL) is advancing plans for its initial public offering (IPO), which is anticipated to raise around $400 million, according to a Bloomberg report citing sources familiar with the matter. The listing, initially approved by the market regulator last October, is expected to proceed by July. 

NSDL's managing director, Vijay Chandok, did not comment on the IPO timelinei, said the global new agency. However, the regulatory approval window to launch the IPO ends on 31 July. The unlisted market speculates the IPO could be launched soon, given the recent momentum and the company's strategic preparations.

To facilitate the IPO, NSDL submitted an addendum to its Draft Red Herring Prospectus, reducing the issue size to 50.15 million shares from the initially planned 57.26 million. Major shareholders like IDBI Bank Ltd, NSE, and Union Bank of India will offload their stakes, providing liquidity and opportunity for new investors.

IDBI Bank plans to sell 22,220,000 shares, NSE will offload 18,000,001 shares, and Union Bank of India will offer 50,145,001 shares. ICICI Securities, Axis Capital, and other firms will manage the IPO with MUFG Intime India as the registrar. This consortium of managers underscores the importance and scale of the offering.

Recent financial disclosures show NSDL's strong performance, with a net profit of Rs 83.3 crore and revenue of Rs 364 crore for the quarter ending 31 March 2025. The company reported an EBITDA of Rs 91.2 crore with a margin of 25.1%. These figures highlight NSDL's robust financial health and operational efficiency.

In recent months, NSDL has seen its unlisted stock price soar by almost 40% to approximately Rs 1,200-1,250, compared to Rs 900 in April. This surge is attributed to increased retail interest and a simplified process for unlisted share transfers, which has made transactions more efficient and attractive to investors.

Despite the rising stock price, some market participants anticipate the IPO price band to be lower, potentially between Rs 700-800 per share. This estimate remains speculative and is not yet confirmed by official sources, but it reflects a cautious approach by investors.

For the fiscal year 2024-25, NSDL achieved a net profit of Rs 343 crore on revenue of Rs 1,420 crore, with an annual EBITDA of Rs 375 crore. These results underscore the company's robust financial position in the duopoly market, which is a significant factor for potential investors.

The sharp rise in NSDL shares within the unlisted market is partly due to retail enthusiasm and the rally in NSE's unlisted shares, as well as NSDL's sound financial record. The streamlined share transfer process has also contributed to this surge, making NSDL a more attractive investment.