India’s markets regulator Sebi could issue this month a key clearance for the National Stock Exchange (NSE) to move ahead with its initial public offering, clearing a major procedural hurdle in the bourse’s listing plan.
“We are at a very advanced stage of issuing the NOC for NSE IPO, maybe within this month,” Tuhin Kanta Pandey, Sebi chairman, told reporters in Chennai.
The step is critical because the exchange’s listing ambitions have been stalled for years amid regulatory action and litigation. The Mumbai-headquartered bourse has been trying to list since 2016 to enable some of its biggest investors to exit.
NSE, also the world’s most active derivatives exchange, has been in litigation with the Sebi since 2019, when it was fined ₹1,100 crore ($122.04 million) for failing to provide equitable access to all its trading members.
Sebi has been conducting an inspection of the exchange’s systems and processes before issuing the no-objection certificate, Reuters reported.
Sebi wrote to the NSE in February last year, flagging concerns about the bourse’s internal processes, including how management is appointed and remunerated, its failure to appoint a chairperson and technology shortfalls.
The approval from Sebi, which Pandey could be issued this month, will allow the NSE to prepare its IPO prospectus and is a crucial step in gaining IPO approval, given the dispute between the two sides.
Among NSE’s largest investors are the Life Insurance Corporation of India with a 10.72 per cent stake and the State Bank of India with 7.76 per cent, while Morgan Stanley owns 1.58 per cent and the Canada Pension Investment Plan Board has 1.60 per cent.
Its main domestic rival, BSE, listed in 2017.
In an interview with CNBC TV18 in September last year, NSE CEO Ashish Chauhan had estimated that it would take about eight to nine months before the exchange could be listed.
He explained that after receiving the NOC, NSE would need approximately four months to prepare the draft red herring prospectus (DRHP), followed by another four months for SEBI’s review and any queries.
