NSE Shareholder Base Surpasses 1 Lakh Amid Ongoing IPO Approval Delays

The National Stock Exchange of India (NSE), the country’s biggest stock exchange by turnover, just hit a significant milestone: over 100,000 shareholders. It’s a sign of how much investor interest is growing, especially impressive considering the NSE is still waiting for the green light on its long-awaited initial public offering (IPO).

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Surge in Shareholders

By May 2024, NSE’s shareholder count had jumped to nearly 15,000 from 2,607 in March 2022. What’s driving this surge? A hot unlisted market where NSE shares are being actively traded. Investors are betting big on the IPO; prices for NSE shares have doubled from ₹900 to ₹1,800 this year alone.

Still Waiting on the IPO

Despite all this momentum, NSE’s IPO has been stuck in a loop of delays. It first filed for an IPO in December 2016. However, that hit a wall when SEBI raised red flags, especially around the co-location case, and NSE had to pull its application in 2019.

They tried again in August 2024, asking SEBI for the go-ahead. But by December, there was still no response. That silence pushed a group of investors, backed by the People Activism Forum, to take the matter to the Delhi High Court, asking it to nudge SEBI into action.

What’s Holding SEBI Back?

SEBI’s caution isn’t without reason. The infamous co-location case, where some brokers allegedly got unfair access to NSE’s trading systems, remains a sticking point. SEBI penalised NSE in 2019, but the Securities Appellate Tribunal softened the blow in early 2023. SEBI disagreed with that and escalated the issue to the Supreme Court, which is now reviewing the case.

In addition, SEBI wants to see NSE run glitch-free for a year, upgrade its tech infrastructure, and clear all legal baggage before it considers the IPO.

Strong Financials, Despite Setbacks

Here’s the twist: despite all the red tape, NSE’s numbers look great. From FY2019 to FY2024, its revenue shot up more than 5x, from ₹3,028 crore to ₹16,434 crore. Net profit also saw a giant leap, from ₹1,708 crore to over ₹8,305 crore. And they’ve done it with a lean, debt-free setup. Nearly three-quarters of their income comes from transaction charges.

Investors Are Getting Impatient

With the IPO still stuck, some investors are understandably frustrated. They feel like they’re sitting on value they can’t unlock. The People Activism Forum argues that the public is missing out too, being kept from investing in one of the country’s most important financial institutions.

If it finally gets listed, NSE would be the third stock exchange in India to go public, after BSE and MCX. Given its dominance in the market, there’s little doubt it’ll draw major investor interest.

What’s Next?

As NSE’s shareholder count climbs and the pressure builds, everyone’s waiting for SEBI to break its silence. Yes, regulators need to be cautious; that’s their job. However, bringing more clarity and urgency to the process would go a long way in restoring investor confidence and strengthening the credibility of India’s financial system.