The National Stock Exchange of India (NSE) has filed its Draft Red Herring Prospectus (DRHP) with capital markets regulator Sebi, formally setting in motion an IPO that has been delayed for nearly a decade. According to the document, the IPO, with a face value of Rs 1, is entirely an offer-for-sale of up to 14.89 crore shares by SBI and other key existing investors. The size of the issue is expected to be around $3 billion, according to a source aware of the development.
The filing marks the culmination of a listing process first attempted in December 2016, when NSE filed its first DRHP for a Rs 10,000-crore issue before the process was stalled by the co-location controversy.
The IPO is structured entirely as an offer for sale, meaning the exchange itself will not raise any fresh capital. Instead, the proceeds will go entirely to existing shareholders who are looking to dilute a portion of their holding in the bourse.
The filing comes months after Sebi issued a formal no-objection certificate to NSE earlier this year in January, removing the last major regulatory hurdle that had stalled the exchange's listing plans since 2016. NSE had appointed 20 merchant bankers to manage the offering in March, and has since been working towards completing its draft prospectus following the declaration of its annual financial results.
NSE currently trades in the unlisted market at around Rs 1,950-2,050 per share, implying a valuation of roughly Rs 5 lakh crore. That would make it one of the most valuable listed financial institutions in India once the public issue is completed.
According to Nitant Darekar, research analyst at Bonanza, the exchange is already commanding premium valuations in the unlisted market. "NSE remains a capital-light near-monopoly. At around Rs 1,950-2,170 in the unlisted market, it trades near 45x FY26 earnings. That's rich, but below BSE at around 70x and MCX at around 80x," Darekar said.
He noted that the recent settlement of the long-running co-location case has removed a key overhang that had weighed on the listing process for years.
The case originated from allegations dating back to 2015 that certain algorithmic trading brokers had received preferential access to NSE's co-location servers, gaining market data milliseconds ahead of the rest of the market. Sebi's investigation into the matter ran for years and led to executive overhauls and governance reforms at the exchange.
Darekar cautioned that investors should remain mindful of the exchange's dependence on derivatives trading volumes. "Earnings remain linked to derivatives trading activity, which can be volatile, especially after regulatory changes in the futures and options segment," he said.
Sebi has tightened norms around retail participation in the F&O segment over the past two years, a factor that has weighed on trading volumes and, by extension, on exchange revenues.
The expected filing also comes at a time when India's primary market is looking for a fresh trigger after a relatively subdued start to the year. Analysts believe the NSE IPO could become one of the biggest capital market events in recent years and help revive investor interest in new listings.
Once completed, the listing will provide a formal market value for India's dominant exchange operator and offer investors direct exposure to the country's growing capital markets ecosystem.
NSE commands a near-total share of trading volumes across India's two most actively traded asset classes, a position that has made it one of the most closely watched unlisted names on Dalal Street for years.
NSE, in its DRHP said, operations are supported by its proprietary technology infrastructure that is resilient and secure, supporting high-speed and high-frequency transactions while ensuring seamless market operations, comprehensive market data dissemination, and allows for rapid implementation of regulatory directives.
The company has played a pivotal role in transforming the capital markets in India by democratizing access and enabling efficient capital flows through a transparent, technology-driven ecosystem.
This transformation is reflected in the expansion of its unique registered investors base, which has grown at a compounded rate of 26.9% from 30.87 million as of 31 March, 2020 to 129.1 million as of 31 March, 2026. In FY2026, total fund mobilisation of Rs 20.3 trillion was raised through its platform. Investors on the company’s stock exchange span over 99% of Indian postal codes as of March 2026.
