National Stock Exchange one step closer to IPO filing as Sebi grants NOC

For the NSE to go public, it has to submit both the NOC and an approved DRHP, say experts

The Securities and Exchange Board of India (Sebi) has granted a no-objection certificate (NOC) to the National Stock Exchange of India (NSE), paving the way for the country’s biggest exchange — currently valued at ₹5 trillion in the unlisted market — to file draft documents for its long-awaited initial public offering (IPO). 

“We are delighted to receive Sebi approval for our IPO — a significant milestone in our growth journey. With Sebi's nod, we embark on a new chapter of value creation for all our stakeholders. This approval also reinforces confidence in NSE being an integral part of the Indian economy and beacon of Indian capital markets,” said Srinivas Injeti, chairperson, NSE. 

The regulatory nod follows the resolution of several legal overhangs, including matters related to colocation and dark fibre, that have weighed on the exchange for over a decade. Sebi has agreed to the settlement in principle, with final terms expected after approval from its high-powered advisory committee, sources said. 

Industry experts noted that regulated entities must obtain an NoC from their respective regulators before filing for an IPO. In NSE’s case, both the NOC and the eventual approval of the draft red herring prospectus (DRHP) are required from Sebi. 

Sources added that the exchange may file its draft papers by April-May this year, and the proposed issue is expected to be entirely an offer for sale. Emailed queries sent to Sebi remained unanswered. 

The exchange recognised a provision of ₹1,297 crore, including interest, towards the settlement of matters linked to colocation and dark fibre cases. The NSE had said this was over and above the ₹100 crore penalty imposed by the Securities Appellate Tribunal (SAT) in the colocation case, which had already been adjusted against amounts deposited with Sebi in 2022-23 (FY23). 

The NSE reported a consolidated net profit of ₹2,098 crore in the second quarter of 2025-26 (Q2FY26), sharply lower than ₹3,137 crore a year earlier, primarily due to one-time provisioning related to settlement applications filed with Sebi. 

Consolidated revenue from operations declined nearly 18 per cent year-on-year (Y-o-Y) to ₹3,676.8 crore in Q2FY26. Revenue from transaction charges fell 22 per cent to ₹2,785 crore, reflecting lower volumes across both cash and derivatives segments. 

The colocation case, currently pending before the Supreme Court, pertains to allegations that certain brokers received preferential access to NSE’s trading servers between 2015 and 2016. Once Sebi formally clears the settlement, it will be required to file an affidavit in the apex court seeking withdrawal of its appeal. 

In January 2023, SAT upheld non-monetary penalties against the NSE but set aside the disgorgement order, instead imposing a fine of about ₹100 crore for lapses in due diligence. Later that year, the Supreme Court directed Sebi to refund around ₹300 crore to the NSE in connection with the matter. 

Despite being unlisted, the NSE already boasts of a large retail shareholder base. The number of retail shareholders of the exchange stood at 171,563 as of December 2025, collectively holding about 12.3 per cent of the exchange. 

Clearing regulatory hurdle

• In the wake of this nod, the NSE finally can file long-awaited draft IPO papers with the regulator
• This resolves legal challenges related to the NSE’s co-location and dark fibre case
• The final terms of the agreement expected after nod from Sebi’s advisory committee
• The NSE is expected to file DRHP in April-May this year, with its IPO being entirely an offer-for-sale