NSE gets key approval for its IPO, settlement to follow in due course

As per estimates after getting NOC from SEBI, NSE may take 8-9 months to launch its IPO. Though, it will be Offer for Sale and no money will come to the exchange.

• NSE gets SEBI's NOC to proceed with IPO filing after long regulatory process
• NSE to pay around Rs 1,400 crore to settle co-location and dark fibre cases
• IPO in 8-9 months; Offer for Sale, no new funds raised

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NSE’s plans for filing of Initial Public Offer (IPO) has got the green signal from market regulator Securities and Exchange Board of India (SEBI), sources told Moneycontrol.

SEBI’s department regulating stock exchanges and other market infrastructure institutions (MIIs) has issued a No Objection Certificate (NOC) to apply for IPO. As per the norms, the sectoral regulator’s approval is required for companies to apply before IPOs, in this case the approval of Market Regulation Department (MRD) was required.

After the key document in hand NSE can now officially engage with merchant bankers and law firms to prepare its application document for IPO or Draft Red Herring Prospectus (DRHP). As per estimates after getting NOC from SEBI, NSE may take 8-9 months to launch its IPO. Though, it will be Offer for Sale and no money will come to the exchange. NSE has first filed for its IPO in 2016 and later it had to withdraw. As per the price of NSE shares the market cap is expected to be around Rs 5 Lakh crore.

Earlier it was believed that approval of NSEs settlement from High Powered Advisory Committee (HPAC) on Settlement may be the key for issuance of NOC. But since it was taking too long in the process, and SEBI’s key departments handling the matter had agreed in principal to settle the issue under consent mechanism, hence the NOC was issued, without waiting for the go ahead from HPAC. As the matter has been deliberated among the SEBI’s internal departments, it is expected that the matter will be soon sent to HPAC for consideration and then before panel of SEBI’s two whole time members for final approval. After the approval of panel of WTM’s, SEBI can seek the withdrawal of case before Supreme Court and finally closing the matter.

On June 20, 2025 NSE had filed a settlement application before market SEBI for settlement of the co-location and other cases. As per people familiar with the matter, NSE had agreed to pay around Rs 1,400 crore as the settlement amount for the co-location and dark fibre cases. In the latest financial numbers released in November, 2025, NSE has made a provision of Rs 1297 crore in addition to the Rs 100 crore already deposited with SEBI as per the SAT order of 2023.

Legal experts have a view that as NSE had won the case before SAT and the Supreme Court did not give any relief in favour of SEBI, the case was more in favour of exchange then the regulator. But, probably the exchange’s shareholders wanted the matter to be closed hence the NSE board approved for the settlement of the case and agreed to pay close to Rs 1400 crore.

In the co-location case, it was alleged that some brokers exploited NSE’s facility by placing their servers physically closer to the exchange’s servers for faster data access and gained unfair edge over others. Similarly, SEBI alleged that NSE provided preferential access to certain brokers through the use of dark fibre for faster connectivity to co-location facilities

The people cited said that after multiple rounds of negotiations an amount of close to Rs 1,400 crore was arrived at. The final amount may vary as interest at the rate of 12 percent will be charged till the date of settlement. The talks were on since March last year.