NSE IPO price band to be announced tomorrow: CNBC-TV18

New business data points to the fact that The price range for the much-awaited National Stock Exchange (NSE) IPO will be officially announced on Friday, September 11, CNBC-TV18 noted on Thursday, citing sources. The development comes a day after NSE filed its updated draft red herring prospectus (UDRHP) with the Securities and Exchange Board of India (SEBI) and the bourses, taking the country's largest bourse a step closer to its long-awaited public stock-exchange debut.

The NSE IPO is now likely to be around Rs 23,000 crore in size, smaller than the roughly Rs 30,000 crore offering envisaged when the exchange filed its original draft red herring prospectus in June, Moneycontrol noted on Wednesday, citing sources. The reduction follows a decision by some existing shareholders, including public-sector insurance firms and Morgan Stanley, to sell fewer shares through the offer.

The IPO will stay entirely an offer for sale (OFS), meaning the money boosted will go to the selling shareholders rather than to NSE. The original DRHP had proposed an OFS of 14.89 crore shares, equivalent to around 6 percent of the exchange's paid-up equity capital.

The downsizing could additionally mean that the NSE IPO falls short of becoming India's largest-ever public offering, a distinction at present held by Hyundai Motor India's Rs 27,870-crore IPO in 2024.

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NSE is likely to price its shares in the range of Rs 1,700 to Rs 1,785 apiece, Bloomberg noted earlier, citing unidentified sources. That is below an earlier marketed range of Rs 2,000 to Rs 2,100 per share. The exchange could additionally reduce the stake being offered through the IPO to around 5.5 percent from the 6 percent proposed in its original draft prospectus, according to the report.

At the upper end of the noted Rs 1,785 price range, a 5.5 percent stake sale could value NSE at as much as Rs 4.42 lakh crore, the note stated, adding that the exchange had previously targeted a valuation of as much as Rs 5.26 lakh crore. Why NSE IPO size could shrink

The smaller offering size comes as several existing shareholders reduce the number of NSE shares they intend to sell. In the original DRHP, General Insurance Corporation of India (GIC Re) had offered to sell up to 1.066 crore shares, while New India Assurance proposed to sell 1.05 crore shares. National Insurance Firm and United India Insurance Firm had proposed to sell 60 lakh shares each.

Together, the four public-sector insurers had initially proposed to sell around 3.37 crore NSE shares. Some of these insurers have since reduced their proposed stake sales, sources told Moneycontrol.

MS Strategic (Mauritius) Ltd, an entity linked to Morgan Stanley, has additionally reduced the number of shares it intends to offer, according to sources. The original DRHP had proposed the sale of 1.60 crore shares by MS Strategic.

Morgan Stanley, Temasek Holdings, State Bank of India, Stock Holding Corporation of India, GIC Re, New India Assurance, National Insurance and other existing shareholders were among those named as selling shareholders in the IPO documents.