Valuation question! Why did NSE cut its IPO size and price below unlisted market levels?
NSE MD and CEO Ashish Chauhan said the exchange had invited shareholders to tender shares before filing the draft red herring prospectus. He said bankers advised the exchange on pricing, while the IPO size was based on the shares tendered by shareholders on the day of the updated draft red herring prospectus.
The National Stock Exchange (NSE) has reduced the size and price of its initial public offering (IPO) below the levels previously expected in the unlisted market. This move has raised questions about whether NSE is opting for a safer listing rather than an aggressive valuation. The IPO has been cut by approximately 15%, with the issue priced lower than the levels at which the stock traded in the unlisted market.
This decision was made despite NSE remaining one of India's most profitable and dominant market infrastructure companies. The exchange invited shareholders to tender shares before filing the draft red herring prospectus and adjusted the IPO size based on the shares tendered on the day of the updated prospectus. The IPO is an offer for sale, meaning NSE will not receive fresh capital from the public issue.
Instead, existing shareholders are selling part of their stake to public investors, with the issue size directly dependent on shareholder willingness to sell. The reduced IPO size reflects shareholder participation rather than a change in NSE's need for capital.
Written by urgent.news from The Economic Times - Top News's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
