In a bid to expedite the National Stock Exchange (NSE) initial public offering (IPO), the People Activism Forum has escalated the matter to the Delhi High Court. This move comes amid prolonged frustrations over the NSE IPO delay caused by the Securities and Exchange Board of India (SEBI) withholding a no-objection certificate (NOC). Despite NSE’s reapplication on 27 August 2024, SEBI has yet to grant approval, leaving investors and stakeholders in limbo.
Legal Push for NSE IPO Approval
The People Activism Forum, in an affidavit filed last week, accused SEBI of failing to provide adequate justification for withholding the NOC necessary for NSE’s IPO. The investors argue that this prolonged NSE IPO delay has stifled opportunities for existing shareholders to unlock the value of their investments. Furthermore, they claim that the public is being denied access to invest in one of India’s premier stock exchanges.
The situation has fueled heightened interest in NSE shares within the unlisted market, where share prices have surged from INR 900 to INR 1,800 over the course of 2024., driven by anticipation of an imminent IPO.
Background on NSE’s IPO Journey
NSE’s IPO ambitions date back to 2016 when the exchange first filed for an IPO. However, regulatory investigations into a co-location scam derailed those plans, prompting NSE to withdraw its IPO documents in 2019. Although SEBI concluded its investigation in September 2024, citing insufficient evidence, SEBI has stalled the exchange’s IPO plans, leaving regulatory approval elusive.
Biggest Stakeholders in NSE
The People Activism Forum’s petition stresses that an IPO would enhance transparency and governance, subjecting NSE to stricter regulatory oversight post-listing. However, SEBI has opposed the petition, questioning the Forum’s Locus Standi (legal right to bring a lawsuit) and warning against the precedent such interventions could set for third-party involvement in regulatory matters.
Among NSE’s notable stakeholders are Life Insurance Corporation (LIC) with a 10.72% stake, D-Mart founder Radhakishan Damani holding 1.58%, and major institutional investors like Stock Holding Corporation and SBI Capital Markets. A recent bonus issuance of four shares for every share held has further amplified investor interest in the exchange’s stock.
Awaiting Court Decision
The Delhi High Court has scheduled the matter for a final hearing on 6 March 2025. Investors are hopeful that this legal intervention will resolve the NSE IPO delay, enabling them to unlock the full potential of their holdings while providing the public with an opportunity to invest in India’s largest stock exchange.
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