Off-market deals pick up pace in IPO-bound NSE

PALAK SHAH Mumbai | Updated on February 03, 2021

Trading in the shares of the National Stock Exchange (NSE) is gaining traction ahead of its initial public offer (IPO). Mumbai-based financial services firm Analah Capital has sent out feelers to its clients regarding an investment opportunity in the unlisted shares of the National Stock Exchange (NSE), sources said. Analah is among the largest bankers for unlisted company shares. It has concluded deals for around 2 million (20 lakh) NSE shares in the past few weeks, the sources said. Motilal Oswal and J M Financial are other brokers who are separately looking for deals in NSE shares. LIC, which holds 12.5 per cent stake in the NSE, has put around 9 million shares on offer. In this, it has managed to sell some in the range of ₹1,105 to ₹1,107 per share, according to the sources. SBI Caps is the banker to LIC’s deal.

Sellers of NSE shares

Other sellers of NSE shares include Norwest Venture Partners, SAIF Partners and a few of Dalal Street’s well-known high net worth individuals (HNIs), the sources said. Norwest and SAIF are seeking to sell nearly 1.5 crore shares each at around ₹1,300 a piece. The HNI investors who are looking to offload their stake had bought the NSE shares at around ₹500 a piece (adjusted price), post 2013.

NSE’s total valuation comes at more than ₹54,000 crore if one goes by LIC’s recent share sale. The exchange has a total of nearly 495 million (49.50 lakh) shares outstanding. Nearly 0.1 million (1 lakh) shares were sold by investors during this week at around ₹1,300 a piece, the sources said. Of late, transactions in NSE shares have happened in a broad range of ₹1,100 to ₹1,400 a piece, the sources said. A key reason for investors shying away from NSE deals is that share transfers from the seller to buyers account takes a minimum of 60 days. The exchange conducts a rigorous due diligence regarding the fit and proper and criteria before allowing the transfer of shares.

Higher earnings per share

NSE, which is India’s largest derivatives market, reported earnings per share of ₹27.94 for H1FY 2021 (between April and September 2020). The consolidated EPS for December quarter is likely to be way higher due to a record volume churn in the stock markets on extreme volatility. Between February 2020 and now, NSE’s Nifty index has fallen from a high of around 13,500 to 7500 and rose again to touch a new lifetime high of 14,789. The NSE earns higher transaction charges when the trading volumes are more. The EPS for NSE’s rival BSE currently stands at ₹₹27.59. Multi Commodity Exchange enjoys EPS of ₹42.17.

Published on February 03, 2021

Follow us on Telegram, Facebook, Twitter, Instagram, YouTube and Linkedin. You can also download our Android App or IOS App.

This article is closed for comments.
Please Email the Editor

You May Also Like