NSE Files Updated IPO Papers as Proposed Issue Size Shrinks to Around ₹23,000 Crore

The National Stock Exchange has moved another step closer to its long-awaited stock market debut, filing its updated draft red herring prospectus with SEBI and the stock exchanges on Wednesday. 

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The proposed IPO is now likely to be considerably smaller than initially planned. The issue size is expected to be around ₹23,000 crore, compared with roughly ₹30,000 crore envisaged when NSE filed its original draft papers in June. 

The reduction comes as some public-sector insurers and an entity linked to Morgan Stanley scale back the number of shares they intend to sell through the offer. 

NSE IPO to Remain Entirely an Offer for Sale 

The structure of the NSE IPO remains unchanged in one important respect: it will be entirely an offer for sale. 

That means existing NSE shareholders will sell their shares to investors through the public issue. NSE itself will not receive any proceeds from the IPO. 

In its original draft red herring prospectus, the exchange had proposed an OFS of 14.89 crore shares, representing around 6% of its equity. 

The latest reduction in the expected issue size follows changes in the amount of equity some existing shareholders intend to put up for sale. 

PSU Insurers Reduce Proposed Stake Sales 

Public-sector insurance companies are among the shareholders cutting back their participation in the OFS. 

Under the original draft papers, General Insurance Corporation of India had proposed selling up to 1.066 crore NSE shares, while New India Assurance planned to offer 1.05 crore shares. 

National Insurance Company and United India Insurance Company had each proposed selling 60 lakh shares. 

Together, the four insurers had initially put around 3.37 crore NSE shares on the table. 

The updated issue is expected to include fewer shares from some of these insurers, although the report does not specify the revised individual quantities. 

Morgan Stanley-Linked Entity Also Scales Back 

MS Strategic (Mauritius) Ltd, an entity linked to Morgan Stanley, is also reducing the number of NSE shares it plans to sell. 

The original draft prospectus had provided for MS Strategic to offer 1.60 crore shares through the IPO. 

The revised number of shares it intends to sell was not disclosed in the report. 

Institutional Interest Stands at Around ₹85,000 Crore 

The smaller proposed OFS comes despite sizeable interest from institutional investors. 

According to sources cited in the report, the institutional book has attracted interest of around ₹85,000 crore. 

For NSE, filing the updated prospectus marks another significant step in a listing process that has been years in the making. The exchange first began working towards an IPO nearly a decade ago. 

The latest changes mean the eventual public issue could be much smaller than the ₹30,000 crore initially envisaged. At around ₹23,000 crore, however, the offering would still mark a substantial transaction, with the final proceeds flowing entirely to participating shareholders rather than to NSE itself.