Management

• Shri Srinivas Injeti: Chairperson & Public Interest Director
• Shri Ashishkumar Chauhan: Managing Director & Chief Executive Officer
• Shri Veneet Nayar: Non-Independent Director
• Prof. G. Sivakumar: Public Interest Director
• Shri Rajesh Gopinathan: Public Interest Director
• Justice (Retd.) Smt. Abhilasha Kumari: Public Interest Director
• Prof. (Dr.) Mamata Biswal: Public Interest Director
• Shri Rajeev Vasudeva: Public Interest Director
• Shri Dinesh Pant: Non-Independent Director
• Shri P.R. Ramesh: Public Interest Director
• Shri Viral Mody: Executive Director
• Shri Sanjay Shorey: Executive Director 

Use of Proceeds

The Offer is entirely an Offer for Sale (OFS) of up to 12.64 crore Equity Shares by the Selling Shareholders. NSE will not receive any proceeds from the Offer.

Industry

Indian Macro-Economy India remains the fastest-growing G20 economy and is projected to become the world’s third-largest economy by Fiscal 2032P. Rising incomes, a young workforce, expanding middle class, rapid digitisation, financial inclusion and a growing entrepreneurial ecosystem are driving greater allocation of household savings towards financial assets. These structural factors are supporting deeper capital markets, higher financial participation and sustained capital formation.

Indian Capital Markets are becoming Robust and Resilient with Significant Room for Expansion India has developed into one of the world’s largest and increasingly resilient equity markets. The market capitalisation of entities listed on NSE has increased nearly 107x over June 1996-June 2026, while India was the fourth-largest equity market globally as of June 2026. The Nifty 50 delivered an annualised return of 10.73% in INR terms over the same period. Strong economic growth, increasing investor participation and deeper financialisation provide significant scope for further expansion.

Fundraising in India India’s primary capital market has witnessed strong activity, supported by a growing entrepreneurial ecosystem and increasing corporate funding requirements. NSE facilitated total fund mobilisation of Rs.20.33 trillion in FY26, including fundraising through Mainboard and SME markets. India has also remained among the leading global markets in terms of IPO listings, with NSE ranking among the top three exchange groups globally by number of new IPO listings during FY23-FY26.

Other Offerings India’s inclusion in major global bond indices and improving sovereign credit profile are supporting greater foreign investor participation in debt markets. Gross purchases by FPIs across Indian debt increased from Rs.4.13 trillion in FY24 to Rs.6.43 trillion in FY26, improving the attractiveness and depth of the domestic fixed-income market.

Network Effects Financialisation of household savings is expanding the investor base and improving market liquidity. Higher participation supports greater trading volumes, attracts issuers and enhances product engagement. Increasing transaction volumes also generate valuable datasets, enabling exchanges to introduce new products and operate at lower unit costs. These factors create strong network effects that reinforce market leadership and support the long-term growth of Indian capital markets.

Market Data, Indices, and Data Analytics Indices and market data are becoming increasingly important with the growth of passive investing. Mutual fund AUM increased at a CAGR of 18.60% between March 2021 and March 2026, while other schemes including ETFs and index funds grew at a faster 34.42% CAGR. Index funds alone recorded a 74.19% CAGR in AUM during the period. This creates opportunities for exchanges through index licensing, market data, analytics and related products.

GIFT City and International Financial Centre The development of GIFT City is creating opportunities for Indian exchanges to expand their international market presence. The evolution of international financial centres, alongside increasing cross-border participation, can support the development of new products and services for global investors and Indian issuers. The RHP identifies GIFT City, indices and analytics, and trading technology as three key emerging opportunities for Indian exchanges.

Technology Advancements Technology remains central to the evolution of Indian capital markets. Increasing trading volumes, faster settlement cycles, algorithmic trading, cloud computing, artificial intelligence and other emerging technologies are driving continuous investment in exchange infrastructure. At the same time, technology resilience, cybersecurity, capacity and real-time risk management remain critical for market infrastructure institutions.

Competitive Landscape The Indian exchange industry is primarily led by NSE and BSE, while derivatives also face competition from domestic and international trading venues, multilateral trading facilities and OTC markets. Competition extends to non-trading businesses, including indices, market data and analytics, where exchanges compete with domestic and global providers. NSE’s competitive positioning is supported by brand recognition, liquidity, scale and bundled product offerings.

Regulatory Environment The Indian capital market operates under a mature regulatory framework, with SEBI continuously refining regulations governing trading, settlement, derivatives, investor protection and market infrastructure. Recent measures around expiry cycles, weekly derivatives contracts, position limits and settlement mechanisms have strengthened market discipline but have also moderated speculative derivatives activity.

Competitive Strengths

Market leader in India – a liquid market for all stakeholders NSE has maintained a dominant position in India’s capital markets, supported by superior liquidity, scale and a broad participant base. It has been the largest Indian stock exchange in terms of cash-market and equity-derivatives turnover for several years and remains the leader in exchange-traded currency derivatives. As of June 30, 2026, NSE had 132.37 million unique registered investors, 1,328 trading members and 3,005 listed entities, with listed-market capitalisation of Rs.474.08 trillion. Its market share stood at 93.05% in cash market, 99.72% in equity futures, 68.48% in equity options and 100% in currency options during Q1FY27. Globally, NSE accounted for 10.68% of cash-equity trades and 50.22% of equity-derivative contracts during the quarter, highlighting its exceptional trading scale.

Well positioned to benefit from India’s structural growth tailwinds which drive strong network effects for NSE NSE is well positioned to benefit from India’s increasing financialisation of savings, rising retail participation, expanding institutional investor base and growing capital-market activity. A larger investor base improves liquidity, which attracts more issuers and intermediaries, creating a self-reinforcing network effect. India’s demat accounts increased to 231.55 million as of June 2026, while SIP contributions reached Rs.938.50 billion during Q1FY27. NSE’s registered investor base spans more than 99% of Indian postal codes, enabling participation beyond major metropolitan centres. Increasing listings and capital formation further strengthen the ecosystem. NSE mobilised Rs.20.33 trillion in total funds during FY26, while its growing product portfolio across equities, derivatives, commodities, currencies, debt and mutual funds provides multiple avenues to capture the long-term expansion of India’s financial markets.

Strong brand synonymous with trust, efficiency and transparency, across trading platform as well as clearing, settlement and market supervisory role NSE has built a strong institutional brand around transparency, technological efficiency, investor protection and market integrity. It was among the first Indian exchanges to introduce fully automated, screen-based electronic trading through its NEAT platform, enabling anonymous and order-driven trading with price-time priority. As a market infrastructure institution and first-level regulator, NSE undertakes real-time surveillance, compliance monitoring and investor-protection initiatives in coordination with SEBI. Its clearing subsidiaries provide central counterparty services, while robust margining and risk-management systems support settlement integrity. NSE’s technology infrastructure processed 21.89 billion peak order messages in a single day, while supporting more than 200,000 trading terminals across 1,400+ cities and towns. This combination of trust, transparency, liquidity and operational reliability strengthens customer stickiness and reinforces NSE’s competitive position.

Track record of comprehensive and innovative offerings delivered through a vertically integrated business model NSE has demonstrated a consistent ability to introduce new products and build supporting market infrastructure. Its vertically integrated model brings together trading, clearing, settlement, listing, indices and market-data services, allowing participants to access multiple financial products through an integrated ecosystem. NSE pioneered electronic trading in India and was also the first exchange to launch exchange-traded currency derivatives. Its product portfolio now covers cash equities, ETFs, REITs, InvITs, sovereign gold bonds, government securities, equity derivatives, currency derivatives, commodity derivatives, interest-rate futures and mutual funds. NSE has also expanded into newer areas such as electronic gold receipts and electricity futures. The integrated model enables cross-segment efficiencies, faster product launches and better utilisation of existing technology infrastructure, creating a scalable and capital-efficient platform.

Technology platform built for scale and resilience Technology remains a core competitive advantage for NSE, supporting high trading volumes while maintaining speed, reliability and resilience. The exchange operates seven data centres, more than 14,000 physical and virtual servers, approximately 60 petabytes of enterprise storage capacity and 2,694 Full Rack Equivalent racks. Its platform can process approximately 5 million messages per second, with microsecond response times and nanosecond order acknowledgements across key segments. NSE has also developed extensive APIs and sandbox environments that allow brokers, listed companies, asset managers and technology providers to integrate directly with its infrastructure. Its technology capabilities extend beyond trading into clearing, settlement, surveillance and investor services. Continuous investments in automation, cybersecurity, data analytics and artificial intelligence further strengthen scalability and operational resilience, helping NSE manage growing market participation and increasingly complex financial products.

Combination of scale, growth, profitability and sustained cash generation NSE combines significant operating scale with strong profitability and sustained cash generation, creating an attractive financial profile for a market infrastructure business. Its asset-light and scalable model allows incremental products and volumes to be accommodated without proportionate increases in infrastructure costs. The company’s broad revenue base includes transaction charges, listing services, clearing and settlement, data feeds, terminal services, index licensing, connectivity and investment income. Importantly, its market leadership and scale enable NSE to reinvest in technology and new products while maintaining competitive pricing. The combination of strong cash generation, high operating leverage, extensive infrastructure and low marginal cost of launching additional products provides a strong foundation for sustainable earnings growth.

Experienced and skilled management team committed to upholding strong corporate governance standards NSE is supported by an experienced management team with expertise spanning securities markets, technology, regulatory supervision, client services and financial infrastructure. Management’s understanding of evolving market trends and regulatory requirements supports product innovation while helping the exchange manage operational and systemic risks. As a market infrastructure institution, NSE places significant emphasis on governance, transparency and accountability. Its Governing Board has a majority of public interest directors, ensuring that public-interest and regulatory considerations remain central to decision-making. Dedicated committees oversee technology, risk, audit and regulatory functions, while information barriers separate regulatory responsibilities from commercial operations. This governance framework is particularly important given NSE’s dual role as a market infrastructure institution and a commercial enterprise, helping preserve market integrity, stakeholder confidence and long-term institutional credibility.

Peer Comparison

Key Risks & Concerns

Regulatory and Policy Changes NSE operates in a highly regulated industry, and changes introduced by SEBI, RBI, the Ministry of Finance or other authorities can materially influence its business model. Recent changes to the equity-derivatives framework, including restrictions on weekly expiries, changes in contract specifications, open-interest calculations and position limits, have already affected derivatives volumes. Further measures aimed at reducing speculative trading, protecting retail investors or improving market stability could moderate transaction volumes and consequently impact NSE’s earnings.

Technology, Cybersecurity and Operational Risks NSE’s operations are critically dependent on sophisticated electronic trading, clearing and settlement infrastructure. System failures, software bugs, connectivity problems, order-routing errors, cyberattacks, ransomware, data breaches or denial-of-service attacks could disrupt trading and damage the exchange’s reputation. Given the scale of NSE’s operations, even a short disruption could have significant financial and regulatory consequences. Dependence on third-party technology and infrastructure providers further increases operational risk.

Competition and Potential Loss of Market Share NSE faces competition primarily from BSE and other recognised exchanges across different asset classes. While NSE currently enjoys substantial market-share leadership, competitors can introduce attractive products, modify pricing structures, improve technology or target specific market segments. Changes in expiry-day structures and product offerings could influence the allocation of trading volumes between exchanges. A sustained loss of market share could adversely affect transaction income, liquidity and the strength of NSE’s network effects.

Market Volatility and Macroeconomic Risks NSE’s business is indirectly exposed to domestic and global economic conditions. Weak economic growth, higher interest rates, inflation, geopolitical tensions, capital outflows, currency volatility or deterioration in investor sentiment can reduce market participation and trading activity. Conversely, while higher volatility can sometimes increase trading volumes, extreme or prolonged market stress may reduce risk appetite and liquidity. Global financial disruptions can therefore materially affect NSE’s transaction volumes, capital-market activity and financial performance.

Clearing, Settlement and Counterparty Risk Through its clearing subsidiaries, NSE assumes an important role in clearing and settlement and acts as a central counterparty for trades. A default by a clearing member, particularly during periods of extreme market volatility, could create substantial settlement obligations. Although NSE maintains margins, collateral and a Core Settlement Guarantee Fund, a severe stress event involving multiple large defaults could potentially exceed available risk buffers and adversely affect the financial position of the clearing ecosystem.

Execution Risk in New Products and Diversification NSE is expanding beyond its core trading franchise into areas such as commodities, electricity futures, GIFT City operations, global access, data monetisation and new index products. These initiatives provide growth opportunities but involve execution, technology, regulatory and adoption risks. If new products fail to achieve expected volumes or monetisation, the company may incur additional technology and operating costs without generating commensurate returns.

Outlook and Valuation

NSE’s medium-to-long-term outlook remains constructive, supported by India’s structural financialisation, rising retail and institutional participation, increasing capital-market mobilisation and sustained growth in equity and derivatives activity. With 132.37 million unique registered investors and 3,005 listed entities as of June 2026, NSE benefits from significant scale, deep liquidity and strong network effects. Its vertically integrated, asset-light model across trading, clearing, settlement, indices and market data supports high profitability, reflected in an FY26 operating EBITDA margin of 66.85% and PAT margin of 50.98%. Consolidated Total Income increased from Rs.16,352 crore in FY24 to Rs.18,713 crore in FY26, while FY26 EPS stood at Rs.41.62 and RoNW at 33.21%. At the indicated upper price band of Rs.1,785, the issue is valued at around 42.9x FY26 EPS, broadly comparable with the valuation of listed peer BSE. The key near-term concern remains NSE’s reduced share in index options following regulatory changes and higher securities transaction tax, which could moderate derivatives volumes. Nevertheless, its dominant market position, strong cash generation, high margins, debt-free balance sheet and opportunities across GIFT City, indices and data services provide a strong foundation for sustainable long-term growth. Hence, we recommend SUBSCRIBING to the issue, with potential for listing gains as well as medium- to long-term value creation.