Morgan Stanley, Temasek Set for Big Pay Day From NSE’s India IPO
The National Stock Exchange of India Ltd.’s planned initial public offering is set to unlock the value of long-term investments for a group of backers including Morgan Stanley, Temasek Holdings Pte. and State Bank of India.
Among the biggest beneficiaries is SBI, which is selling 24.75 million shares. It stands to gain about 50 billion rupees ($529 million), based on the gray market price of 2,055 rupees a share on unlisted stock trading platform sharescart.com and its average acquisition cost of 80 paise apiece. That’s an almost 2,568 fold gain for the stake SBI acquired between 1993 and 1999 — and doesn’t include the increase in the value of its remaining holding.
Other founding shareholders, including Stock Holding Corporation of India Ltd., General Insurance Corp. of India, New India Assurance Co. Ltd., National Insurance Co. Ltd. and Oriental Insurance Co. are also in line for sizable windfalls — as much as 6,422 times returns for the last three. Stock Holding Corp., which is selling about 11 million shares, acquired much of its stake at a cost of 46 paise per share and is on track for 4,467 fold returns based on the gray market price.
Many investors have been seeking an exit since NSE, the operator of the world’s busiest derivatives market, first attempted to go public in 2016 with a plan that was derailed by regulatory and legal hurdles. The pressure has built as NSE’s value soared over the past decade with India’s capital markets expanding and retail participation surging. The exchange now dominates domestic equity derivatives trading and has emerged as one of the world’s largest exchanges by contracts traded.
