BSE sets initial public offering at Rs 805-806 band, may raise Rs 1243 cr

BSE's IPO of shares next week may raise as much as Rs 1,243 crore for its investors

Indian stock exchange BSE’s initial public offering (IPO) of shares next week may raise as much as Rs 1,243 crore ($182 million) for its investors, based on the indicative price range for the sale announced on Monday.

Investors, led by Singapore Exchange, Atticus Mauritius and billionaire George Soros’ Quantum, will be selling up to 15.4 million shares in Asia’s oldest stock exchange in a price range Rs 805-806 a share, according to a public announcement.

The IPO, which will be open for sale from January 23 to January 25, will value the stock exchange at about Rs 4,400 crore ($645 million) at the top end of the price range. 

By comparison, Hong Kong Exchanges and Clearing has a market capitalisation of nearly $30 billion, while the Singapore Exchange is valued at more than $5.5 billion.

BSE’s offering will be the first in Indian markets in 2017, after companies raised about $4 billion in 2016 from initial share sales making it the best year in six.

Founded in 1875, BSE, whose first venue for broker meetings was under a banyan tree in India’s financial capital Mumbai, has long been considering an IPO. However, a lack of clarity on the rules for listing stock exchanges had delayed the process.

Indian investment banks Edelweiss and Axis Capital along with Jefferies and Nomura are the global coordinators for the BSE offering. Motilal Oswal, SBI Capital Markets, SMC Capitals and Spark Capital are the other bookrunners.  

Shares of BSE will list on rival National Stock Exchange (NSE) as domestic rules don’t allow self-listing. Shares, however, could be available for trading on its own platform, under the permitted-to-trade category. Shares of BSE are expected to list on February 3. BSE will be the first securities market infrastructure institution to list.

BSE’s IPO could be followed by the IPO of depository firm CDSL, in which BSE owns 50 per cent stake. The bourse will be divesting 26 per cent stake in CDSL in the IPO. NSE, the country’s largest stock exchange, too, is expected to list soon. Both NSE and CDSL are currently awaiting Sebi’s nod for their IPOs.