National Stock Exchange IPO size may shrink to Rs 25,000-27,000 crore as shareholders cut OFS
Offer-for-sale portion likely to fall to 5.2-5.5% from 6% as some investors opt to hold their stake; IPO expected to open on September 18
The size of the National Stock Exchange (NSE) initial public offering (IPO) could be lower, with the offer for sale (OFS) likely to be reduced to 5.2–5.5 percent from the 6 percent initially planned, people aware of the matter said on Wednesday.
They said this is happening as certain shareholders have withdrawn from the sale.
A reduced OFS might cut the overall issue amount to Rs 25,000–27,000 crore compared to the previous estimate of Rs 30,000 crore.
NSE might not be able to become the biggest public offering in India at this size. At Rs 27,870 crore, Hyundai Motor India’s IPO presently retains the record.
According to the sources, several shareholders decided not to sell at the IPO as they thought they could command a higher price by selling their position later, which is thought to be the reason behind the OFS’s size reduction.
Additionally, the NSE aims to attract more retail investors to the issue by structuring pricing to increase participation and benefit small investors in the OFS. Instead of the previous estimate of Rs 2,000 per share, the IPO price band is expected to be in the bracket of Rs 1,700-1,785 per share.
It is expected that the NSE IPO would begin accepting public subscriptions on September 18 and end on September 22. Sources stated that the shares will probably go public on September 25. Prior to the ‘Pitru Paksha’ period, which starts on September 26, the listing is planned.
The digital services division of the billionaire Mukesh Ambani-led business, Jio Platforms, will compete with the NSE’s offering.
Although the timing of Jio’s offering has not yet been disclosed, it is likely to be worth Rs 37,700 crore.
Last week, market regulator Sebi, the market regulator, approved NSE to proceed with its public offering last week.
The permission was a significant step for NSE, whose aim to list had been put on hold for almost ten years due to regulatory hurdles, such as the co-location dispute.
In June, NSE submitted its draft prospectus to Sebi.
The addition of SBI Capital Markets to the list of selling stockholders, however, caused a new 21-day public feedback window on the revised paperwork, which caused the clearance timeframe to slow down.
