The National Stock Exchange of India's $2.3 billion IPO was fully subscribed on the second day of bidding, putting the spotlight on its September 24 debut as investors weigh the potential for quick listing gains amid limited share supply.
The listing will mark the culmination of a decade-long effort by India’s biggest stock exchange operator to enter public markets, after regulatory scrutiny and legal disputes repeatedly delayed its debut.
The offering also comes as India's primary market draws a new wave of large issuers, including billionaire Mukesh Ambani-backed Jio Platforms, which is expected to list by year-end.
The IPO received bids for about 90 million shares, against 88.6 million on offer, as of 3:30 p.m. IST on Friday, exchange data showed.
"There could be some profit-taking on listing day from investors who acquired shares at lower levels or are looking to monetise gains quickly," said Saurabh Jain, deputy vice president of equities at SMC Global.
Retail investors subscribed to 0.68 times the shares reserved for them, while big-ticket non-institutional investors bid for 1.44 times their allocation. Shares set aside for qualified institutional buyers were subscribed 1.32 times.
EYES ON LISTING
NSE shares are expected to begin trading on September 24, with the IPO being entirely an offer for sale by existing shareholders, leaving the exchange with no proceeds.
Only about 5.48% of NSE's pre-offer capital will be freely sellable at listing, said Aishvarya Dadheech, founder and chief investment officer at Fident Asset Management, potentially limiting selling pressure.
"Relatively limited float, coupled with the possibility of early FTSE index inclusion and later demand from active funds following benchmark inclusion, could provide support to the share price," Dadheech said.
A weak opening or intraday pressure should not necessarily signal a change in the company's long-term fundamentals, SMC Global's Jain said.
Earlier this week, the exchange operator allotted $703 million worth of shares to marquee global and domestic investors, including the sovereign wealth funds of Norway and Abu Dhabi in its anchor book. LIC was the top investor.
The strong anchor demand underscores investor interest ahead of the long-awaited debut, while the limited float could amplify price moves once trading begins.