IFCI, New India Assurance surge as reports of NSE IPO launch this month boost investor interest

Shares of IFCI Ltd and The New India Assurance Company Ltd (NIACL) rose sharply on 2 September after reports suggested that the National Stock Exchange (NSE) could launch its initial public offering (IPO) as early as this month, increasing investor interest in companies that hold stakes in the exchange.

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IFCI shares climbed more than 11% to ₹97 on the NSE, while New India Assurance gained 6.74% to ₹198.30 during the trading session.

Stakeholders seen as key beneficiaries

The rally followed unconfirmed reports that subscriptions for the NSE IPO could open this month. Investors bought shares of listed companies with direct or indirect ownership in the exchange in anticipation of value unlocking from the proposed listing.

IFCI owns a 52% stake in Stock Holding Corporation of India Ltd (SHCIL), which in turn holds a 4.4% stake in NSE, according to Moneycontrol.

New India Assurance directly owns a 1.42% stake in the exchange.

SBI to dilute stake through IPO

State Bank of India and SBI Capital Markets are also expected to participate in the offering by selling part of their holdings in NSE. SBI Chairman C.S. Setty told PTI that the bank plans to dilute a 0.65% stake through the proposed public issue.

SBI currently holds a 3.23% stake in NSE, while SBI Capital Markets owns 4.33%, according to Moneycontrol.

IPO could be India's largest

Bloomberg previously reported that NSE had marketed the issue to potential investors at a share price range of ₹2,000-2,100, implying a valuation of up to $55 billion.

At that valuation, a sale of around 6% equity could raise approximately ₹31,500 crore, according to Bloomberg estimates cited by Moneycontrol. That would exceed the ₹27,870 crore raised by Hyundai Motor India in 2024, currently India's largest IPO.

Valuation and listing plans

The proposed valuation would place NSE among the world's largest listed exchange operators by market capitalisation, according to Bloomberg.

Moneycontrol reported that NSE, which operates the world's largest derivatives exchange by trading volume, is seeking a valuation of up to ₹5.26 lakh crore through the IPO. Reports have also suggested that NSE may trade on its own platform under the "permitted to trade" category after listing on BSE.

Market reaction

The prospect of a near-term IPO launch drove buying in companies linked to NSE's shareholding structure, with IFCI and New India Assurance emerging among the strongest gainers during Wednesday's session.