NSE said to plan trading of its shares on own platform

The National Stock Exchange of India Ltd. (NSE) may permit its shares to trade on its own platform following their listing on rival BSE Ltd., according to sources familiar with the matter. This move could potentially redirect trading volumes and facilitate the inclusion of NSE shares in NSE's benchmark indexes. The possibility was discussed during recent road shows for the exchange's proposed initial public offering (IPO), with global investors requesting anonymity due to the sensitive nature of the deliberations.

Under the proposed framework, NSE shares could trade in the "permitted to trade" category even though they would formally list on BSE. However, the current regulations do not provide for the self-listing of a stock exchange, and NSE would need approval from the Securities and Exchange Board of India (Sebi) to allow its shares to trade on its own platform.

Discussions regarding this potential development are ongoing, contingent on obtaining regulatory approval. A NSE representative did not respond to requests for comment. The "permitted to trade" framework allows securities to trade on the NSE without being formally listed, maintaining their compliance and disclosure obligations unchanged.

NSE revised its index eligibility rules in 2019 to enable such securities to qualify for inclusion in the Nifty indexes, India's most widely followed gauges. Currently, around 250 companies that are not listed on NSE trade on its platform under the "permitted to trade" category, including Elantas Beck India Ltd., Goodyear India Ltd., and Novartis India Ltd. This arrangement could provide NSE shares with liquidity on both exchanges while retaining BSE as the primary listing venue.

NSE anticipates receiving Sebi's approval for its draft prospectus by the end of August and aims to launch the IPO in the second half of September.