The National Stock Exchange (NSE) will file an initial prospectus with the Securities and Exchange Board of India (Sebi) by January next year, signalling its intention to complete the much-debated listing. The board of India’s largest bourse has also agreed to explore overseas listing for the exchange by April 2017.
The NSE board, after a meeting on Friday, has also revamped a listing committee, which will be tasked with taking decisions related to the IPO, the exchange said in a statement, without disclosing the identity of the new members. The composition of the initial committee had also raised strong opposition from some foreign shareholders, who believed the committee was too close to the management and did not represent their demand for an expedited listing. Five stakeholders, including Norwest Venture Partners, SAIF Partners and GTI Capital, have accused management of ignoring them.
The decision by the NSE to finalise a schedule for its eventual listing is likely to boost the exit prospects for large shareholders, such as, IDBI Bank and IFCI, who have been planning to monetise their shareholding in the exchange.
According to a statement issued on Monday, the NSE said its board had decided on these schedules for its proposed listing, at a meeting last week. “For domestic listing, the board of directors of the exchange - subject to shareholders’ approval - has expressed desire to file the DRHP (draft red herring prospectus) latest by January 2017, after addressing restructuring needs of the exchange and regulatory requirements for listing. The board has also advised the management to file for overseas listing by April 2017,” the bourse said.
IDBI Bank owns 5% in the NSE, while IFCI has 5.5% stake in the bourse. In June 2013, GTI Capital bought 0.4% in the NSE for R79 crore, which values the exchange at R17,955 crore. News of a likely profitable exit route for these financial institutions pulled up their stocks; shares of IDBI Bank ended 2.3% up on a day when the broader index was flat after witnessing a volatile trading day, while IFCI surged 5.8%.
The exchange has been planning to list for some time, but had expressed reservations earlier on norms prior to the listing process, including those related to exchange listing and for clarity on self listing. “The board has re-constituted the current listing committee as an empowered sub-committee of the board. We have been engaged with the regulator to look at all options,” NSE managing director and CEO Chitra Ramkrishna said.
“It’s good that they have given a timeline,” said Amit Jain, a managing director at GTI. “I’d still keep my fingers crossed that it does achieve those timelines.”