NSE hopes to finalise merchant bankers for much awaited IPO this month: MD Chauhan 

The National Stock Exchange’s long-awaited initial public offering moved a step closer on Monday, with a top official saying the appointment of merchant bankers should be completed this month.

“The process is still on of determining the merchant bankers. It should happen in March,” said Ashish Kumar Chauhan, MD and CEO of NSE.

Set up in 1992 and operational since 1994, the exchange has been planning to go public for several years. The IPO process, however, remained stalled as it did not get approval from the Securities and Exchange Board of India for a long time due to multiple issues, including the co-location case, which centred on allegations that some high-frequency traders were given preferential access to server data.

The market regulator issued its no-objection certificate for the IPO last month. NSE had opted to settle the cases with Sebi last year.

The IPO of NSE, the world’s largest derivatives exchange by volumes, is expected to be entirely an offer for sale, with some existing investors likely to pare their stake through the issue.

The exchange is also understood to have reached out to several investment bankers and lawyers for the proposed IPO.

“The SEBI regulations have allowed NSE like companies to go with smaller float because we don't have an identifiable promoter and nobody owns very large stake who can be claimed as a promoter in NSE,” Chauhan said.

Government-approved proposals cleared earlier this year allow large companies planning to go public to dilute only 2.5 per cent of their share capital.

Chauhan was speaking to reporters on the sidelines of an event to mark 30 years of the benchmark Nifty 50 index. He noted that since its launch, the Nifty has delivered around 25 times return.

“If you stay in the market for the long run, don't buy and sell every day, or don't indulge in speculation, then you will be able to get great rewards for an economy which is growing at 7 per cent,” Chauhan said.

The Nifty’s 30-year milestone comes at a time when equity markets across the world have been hit hard by the ongoing Israel and US conflict against Iran, pushing up crude oil prices and creating shortages in natural gas supplies.

Speaking at the event, Sebi chairman Tuhin Kanta Pandey said India’s fundamentals remained strong despite the uncertainty and that there was no reason for panic.

“It's important not panic, but to remain calm. (There have been) several such phases in the past several years, periods of uncertainty, volatility and global shocks. And yet over the long-term it has continued to reflect the strength and resilience of India's growth story,” Pandey said.

He added that SEBI’s objective was to enable innovation-led growth while preserving market integrity and investor confidence.

The regulator has also set up a high-level working group to develop a long-term technology roadmap for securities market institutions.

At the same time, Pandey said exchanges must continue investing in technology, infrastructure, cyber resilience and advanced risk management systems.