NSE IPO timeline: 10 things stock investors should know

A recent comment by SEBI Chair Tuhin Kanta Pandey has rekindled hopes around the much-awaited NSE IPO, causing a stir in the unlisted shares market. "The NSE IPO application is not something that cannot be sorted," Pandey said, triggering optimism among traders. Unlisted NSE shares surged to Rs 2,400–2,420 levels — up over 60 per cent from Rs 1,500 just two weeks ago.

A long-awaited IPO
The National Stock Exchange's IPO is considered one of the most promising public offerings in India. The stock exchange first filed draft papers with SEBI in 2016, aiming to sell a 22 per cent stake for Rs 10,000 crore. However, it never received the mandatory No Objection Certificate (NOC) from SEBI to proceed.

Why the delay?
The IPO was derailed by regulatory issues stemming from 2015, when a few high-frequency traders were alleged to have received unfair access to NSE’s co-location servers. This led SEBI to order forensic audits by independent agencies.

NSE and its employees received three separate show-cause notices from SEBI in 2017 and 2018 related to the co-location controversy, use of dark fibre, governance lapses, and conflict of interest concerns, according to NSE’s 2024 annual report. The co-location issue is long-pending. 

SEBI also showed concerns about NSE's compensation practices, technology governance, and its controlling stake in the Clearing Corporation.

What’s changing now?
A Bloomberg report recently claimed that NSE may offer Rs 1,000 crore to SEBI to settle the dispute, with a decision expected soon. Optimism grew after SEBI’s September 2024 order dismissed charges against NSE and seven former executives—including ex-CEOs Chitra Ramkrishna and Ravi Narain—in a 2019 co-location case due to lack of sufficient evidence.

However, SEBI did criticise NSE for lacking a proper policy for secondary server access and failing to penalise violators, saying it failed in its duties as the market’s first line of regulation.

Why push for the IPO now?
Pressure may be mounting from shareholders eager for value creation. As of March-end, NSE had 39 investors classified as Alternate Investment Funds, including insurance companies, NBFCs, and foreign investors. Foreign Direct Investment accounted for 21.7 per cent of the exchange’s equity, with major stakes from Mahagony Ltd, DVI Fund Mauritius, and RIMCO Mauritius.

NSE denies seeking govt help
NSE last month denied a Reuters report that it sought government intervention to expedite its IPO. "The story is denied by NSE," it said in a post on X, clarifying that it had not contacted the Indian government in the last 30 months on the matter.

What the NSE CEO says
NSE MD & CEO Ashishkumar Chauhan addressed the IPO during the May 7 earnings call. He confirmed that NSE responded to SEBI’s February 28, 2025 letter and requested the NOC needed to proceed with the IPO process.

Chauhan noted that SEBI has not yet regulated the disinvestment of the clearing corporations. This could be a potential hurdle in the IPO process.

Chauhan said once his exchange files papers with the markets regulator, SEBI's timelines may also have to be looked into because the stock exchange has no understanding of what time the exchange would take later on. 

"So, we can only control our timelines. The first milestone currently we are awaiting is the No Objection Certificate," he said.

NSE on SEBI concerns
Chauhan on May 7 said as far as the Clearing Corporation issue is concerned, there are no regulations at present. Also in the case of KMP salaries, there are no regulations. Once they come, they will be implemented, he said.

He said NSE is working without any major disruption over the last four years since 2021; and legal issues need to be disclosed in the DRHP.

"So broadly speaking, overall, we have replied saying many of this will have to be disclosed in DRHP. When SEBI regulations come naturally, we will have to disclose because these talks have started. But overall, there is nothing," he said.

Chauhan said: "The legal issues have to be resolved in some ways, which are in Supreme Court. That actually, again, is a two-way process between the two entities. And so other than that, there are no large issues," he said.

Listing details
When approved, NSE shares will list on the BSE, as SEBI rules prohibit exchanges from listing on their own platforms. BSE listed on NSE back in 2017 to avoid conflict of interest. Sources told Business Today that it would take at least six months for the NSE to come up with the IPO papers following the SEBI go-ahead. 

Valuation & potential size
Unlisted NSE shares are currently valued at Rs 5.98 lakh crore. A 10% equity dilution could raise around Rs 60,000 crore, making it the biggest IPO in Indian history—surpassing LIC’s Rs 21,000 crore listing and Hyundai India’s Rs 28,870 crore IPO in October 2024.

“NSE’s IPO will be the mother of all primary offerings,” said Kranthi Bathini, Director of Equity Strategy at Wealthmills Securities. “Given the valuations and market demand, it’s just a matter of time.