NSE IPO Likely by Q4 FY26: SEBI Clearance Expected by July-End
Recent reports indicate that India’s largest bourse – the National Stock Exchange (NSE) – is finally poised to file its IPO draft papers. Market sources say SEBI is likely to grant a No-Objection Certificate (NOC) by the end of July 2025. With regulatory hurdles being cleared, NSE is targeting a stock-market debut in Q4 of FY2026 (January–March 2026). This breakthrough follows a settlement agreement to resolve the long-standing co-location and dark-fibre cases. In late June, NSE submitted a consent application offering about ₹1,388–1,400 crore to settle those probes. SEBI has reportedly accepted these applications, and Chairman Tuhin Kanta Pandey has stated that “no obstacle” remains for the IPO With all major issues now being resolved, the exchange can move swiftly to file its Draft Red Herring Prospectus and launch the IPO process.
Key Recent Developments
Settlement of Regulatory Cases: NSE filed settlement applications in late June 2025 to close out two major probes: preferential co-location trading and unauthorized “dark fibre” connections. It has agreed to pay roughly ₹1,388–1,400 crore to SEBI to resolve these issues. If accepted, the Supreme Court cases will be withdrawn and SEBI will grant an IPO clearance. Mint reported SEBI “has accepted the settlement applications”, and is expected to issue a formal NOC by month-end.
SEBI’s Green Light: In a recent press briefing, SEBI Chairman Pandey confirmed that listing approval is no longer tied to earlier demands (such as separating clearing houses from exchanges). He emphasized that “no obstacle will remain” once the settlements are finalized. This signals strong regulator support for the IPO.
Shareholder Push: The IPO drive gathered momentum after Pandey’s appointment as SEBI chief in early 2025. Industry sources say discussions between NSE and SEBI have been ongoing since March 2025, culminating in the settlement applications being filed and accepted.
Timeline of Upcoming Milestones
The chart below summarizes recent actions and expected next steps in the IPO process:
May 2025: Media reports revealed NSE and SEBI in advanced talks over settlements. On May 26, Moneycontrol reported that NSE was negotiating to pay ~₹1,300+ crore to settle the co-location and dark-fibre cases.
June 25, 2025: NSE officially submitted settlement applications offering ₹1,388 crore in total to SEBI. SEBI accepted these applications and signaled it would issue a formal NOC by month-end. This step clears the final regulatory barrier.
By July 2025: SEBI is expected to finalize the settlement and issue the NOC. Once received, NSE will file its Draft Red Herring Prospectus (DRHP) with SEBI, kicking off the IPO process. Preparing the DRHP (with audited quarterly results) may take 4–5 months after NOC.
Late 2025: SEBI will review the DRHP and raise queries. NSE and its bankers will address feedback (typically ~2–3 months of review).
Q4 FY2026 (Jan–Mar 2026): Barring delays, NSE aims to open its IPO and list in this period. If all goes smoothly, NSE could be publicly traded by March 2026.
Financial Snapshot (FY2024 vs FY2025)
NSE’s robust financial performance underpins its high valuation and investor interest. In FY2025, the exchange reported ₹19,177 crore in consolidated total income (up 17% YoY) and ₹12,188 crore in net profit (up 47% YoY). For context, FY2024 figures were ₹16,352 crore revenue and ₹8,306 crore profit. The table below highlights this growth:
| Metric | FY2024 | FY2025 | YoY Change |
|---|---|---|---|
| Total Revenue (₹ cr) | 16,352 | 19,177 | +17% |
| Net Profit (₹ cr) | 8,306 | 12,188 | +47% |
These strong earnings helped spur private-market demand for NSE’s shares. Unlisted share trades have valued NSE at roughly $58 billion (about ₹4.8 lakh crore) – higher than Nasdaq and close to Deutsche Börse’s value. In fact, investors have paid up to ~₹2,000 per share (in the grey market). This premium valuation reflects confidence that NSE’s scale (dominant equity & derivatives market share) and growth will sustain long-term returns.
Implications for Investors
Rare Ownership Opportunity: The NSE IPO is a once-in-a-generation chance to own a stake in India’s equity market backbone. The exchange handles ~98% of domestic equity volumes, giving investors exposure to core market infrastructure. Its dominant position and high cash flows (as shown above) make it a strategic asset.
High Valuation – Caution and Potential: With a private-market valuation ~₹5 lakh crore (≈$58B) and FY25 profit ₹12,188 cr, the implied price/earnings multiple is ~40×. This is lofty by historical standards, so investors will need to weigh the premium carefully. If NSE prices its IPO at these levels, short-term returns may be limited. Long-term investors, however, may benefit from continued market growth.
Windfall for Existing Shareholders: A large portion of NSE (roughly 31%) is owned by public entities (PSUs, insurance firms, etc.). These shareholders will see a massive mark-to-market gain when NSE lists. For example, LIC and other government-linked holders stand to profit handsomely, boosting their balance sheets. This windfall can support further investments in their operations without raising new equity.
Retail Demand: Despite being unlisted, NSE shares have seen aggressive buying by wealthy and retail investors. The grey-market rally (to ~₹2,000) shows strong appetite. If the IPO allows broad retail participation (as is customary for Indian IPOs), many retail investors will flock to subscribe. However, they should review the Draft Prospectus closely for governance and risk details.
Global Interest: A listed NSE will attract international capital. With its new status, NSE could be included in global indices and ETFs, inviting foreign institutional demand. This aligns NSE with other global exchange peers like NYSE (ICE) or HKEX, potentially elevating its multiples over time.
Impact on India’s Capital Markets
The impending NSE listing has several broader effects:
Record-breaking IPO: Given the size, NSE’s IPO could become India’s largest ever. Its ~₹5–6 lakh crore valuation dwarfs previous records, highlighting the maturation of India’s capital markets.
Regulatory Precedent: The swift resolution of NSE’s cases via SEBI’s settlement framework sets a template for handling future compliance issues. It shows SEBI’s willingness to negotiate consent terms rather than lengthy litigation, providing clarity to other market intermediaries.
Strengthened Market Ecosystem: NSE’s listing may spur innovation and competition. Already-listed BSE (Bombay Stock Exchange) may respond with upgrades or services to compete. Overall, market transparency and governance norms are likely to improve as the exchange opens its books to public investors.
Macro Confidence: The move signals confidence in India’s market reforms. By finally clearing NSE’s IPO, India reinforces its commitment to market liberalization and global investment. It also injects new capital (from selling the 10% stake) into the economy, potentially funding infrastructure or growth initiatives.
In summary, the long-stalled NSE IPO is now in its final stretch. All eyes will be on SEBI in July 2025 for the formal clearance to file the draft papers. From that point, if the process proceeds smoothly, India’s premier stock exchange could be trading publicly by early 2026. For investors, this marks an unprecedented opportunity – but also one that comes with a premium price.
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Sources: News reports from Moneycontrol, Livemint, Economic Times and Times of India; NSE’s audited results as reported by Moneycontrol and Business Today. All figures and projections are drawn from these credible reports.