National Stock Exchange of India is seeking a valuation of up to 4.42 trillion rupees ($46.31 billion) through its long-awaited IPO, which launches next week and could rank among India's biggest-ever listings.
NSE set a price band of 1,700-1,785 rupees ($17.81-$18.70) per share for the IPO, a public filing showed early Friday. The targeted valuation, at the top of the range, would make NSE one of the country's most valuable companies and within reach of Nasdaq and London Stock Exchange Group.
India's largest bourse had on Thursday cut the size of its IPO by more than 15% as some top investors trimmed the number of shares they intended to sell, which a source told Reuters was primarily on account of a lower-than-expected price band.
The $2.36 billion IPO will likely trail an upcoming offering by billionaire Mukesh Ambani's Reliance Jio expected to raise $3.8 billion and Hyundai Motor India's $3.3 billion issue in 2024.
The offering comes after years of delays and at a time when India's IPO market is regaining momentum after a sluggish start to the year.
NSE's share sale will open for subscription on September 17 and close on September 21, with anchor investor bidding scheduled for September 16. The stock is expected to list on or about September 24.
NSE, the country's biggest exchange by trading volumes, dominates the derivatives market and has benefited from a surge in retail trading in the world's most populous country.
PRICING LOWER THAN EXPECTED
NSE is not selling new shares in the IPO and will not receive proceeds. Existing investors including State Bank of India and Canada Pension Plan Investment Board are offloading a total 126.4 million shares, down from the 148.91 million planned earlier.
SBI is selling the most shares at about 16 million, while its unit SBI Capital Markets was added to the list of selling shareholders. MS Strategic (Mauritius) - a Morgan Stanley fund, is selling 31% fewer shares at 11 million.
The primary reason for the reduced share sales is the lower-than-expected price band, with shareholders believing they will get a better valuation in the secondary market post listing, a source told Reuters on Thursday ahead of the official pricing announcement.
In an informal market where unlisted shares of NSE trade, the price has ranged from 2,000 rupees to 2,100 rupees, according to recent deals.
Tighter market rules have weighed on the likely pricing of the issue, three sources said.
The Securities and Exchange Board of India last year announced tighter curbs on retail participation in the options trading market. Tighter bank funding curbs, higher taxes on derivatives trading and India's newly launched closing auction session have also weighed on trading volumes.
In the quarter ended June 30, NSE's net profit rose 6.7% to 31.2 billion rupees, while revenue from operations rose 13% to 45.6 billion rupees.
