NSE IPO: Goldman, Templeton, Fidelity likely to buy stake in anchor round, says report

NSE IPO: The much-awaited initial public offer (IPO) of National Stock Exchange (NSE) is likely to attract global investors such as Goldman Sachs Asset Management, Franklin Templeton and Fidelity International Ltd. As India's largest stock exchange by trading volumes prepares to raise as much as Rs 22,600 crore  ($2.4 billion), they are likely to chip in with their funds as anchor investors, according to a Bloomberg report.

Norges Bank Investment Management, Abu Dhabi Investment Authority, GIC, Eastspring Investments Services Pte Ltd., Millennium Management, Marshall Wace, Citadel Capital and Ghisallo Capital Management are may also participate in the anchor round.

Anchor investors buy stake in an IPO a day before it opens. The quantum of share purchase by anchor investors reflects confidence in a share sale. The NSE IPO will open on September 17. The issue will open for anchor investors on September 16 (Wednesday).

The anchor book is likely to be about Rs 6,800 crore, the Bloomberg report said. Some important money managers including Capital Group, BlackRock Inc., Aberdeen Group PLC, FMR LLC and T. Rowe Price Group Inc. may skip the offering amid concerns over valuation.

The anchor allotment process is still ongoing, and the final investor lineup may change.

The muted response from investors highlights the ongoing debate over NSE’s valuation, despite the exchange lowering the price band for its much-awaited initial public offering.

NSE’s dominant position in India’s capital markets and strong profitability have generated significant investor interest. However, some funds remain cautious about the valuation, particularly given concerns over the exchange’s future growth prospects and the increasing regulatory scrutiny of stock-market activity.

A key area of concern is options trading, which has emerged as a major contributor to NSE’s earnings. Market regulators have been taking steps to curb speculative activity in the derivatives market, raising questions about the sustainability of the exchange’s rapid growth in this segment.

NSE, the world’s largest derivatives exchange by trading volume, will open its IPO for subscription from September 17 to September 21, with the listing potentially taking place on September 24.

The NSE IPO has a price band of Rs 1,700-1,785 per share, significantly below the earlier indicative range of Rs 2,000-2,100 per share.

The lower price band appears aimed at addressing investor concerns over valuation while still capturing the premium attached to NSE’s market leadership and earnings profile. At the same time, investors are assessing whether the exchange can sustain growth amid tighter regulations and potential pressure on derivatives-led revenues.