BSE shares snap three-day winning streak, slide 4% ahead of NSE IPO

Shares of BSE snapped a three-session winning streak on Wednesday, falling nearly 4% amid reports that rival National Stock Exchange of India (NSE) is likely to file its draft red herring prospectus (DRHP) for its long-awaited initial public offering (IPO) later in the day.

Paring some of their early losses, BSE shares ended 3.81% lower at ₹4,004, with a market capitalisation of ₹1.63 lakh crore. During the session, the stock declined by as much as 4.83% to an intraday low of ₹3,961.

The stock emerged as the biggest loser on the Nifty Capital Markets index, which ended the day 0.38% lower.

The weakness in the BSE came after a strong three-day rally, as investor sentiment turned cautious amid growing expectations of NSE's IPO filing, which could reshape valuations across India's exchange ecosystem.

Among other constituents of the Nifty Capital Markets index, Aditya Birla Sun Life AMC declined 1.93%, while Multi Commodity Exchange of India (MCX) fell 1.02%. Shares of Angel One were largely flat, ending marginally higher by 0.09%.

The broader capital markets pack delivered a mixed performance. KFin Technologies surged 4.21%, while Nuvama Wealth Management gained 4.14%. Central Depository Services (India) (CDSL) and HDFC Asset Management Company rose more than 2% each.

Market participants are closely watching developments around NSE's IPO, one of the most anticipated listings in India's capital markets space. The exchange has been pursuing regulatory approvals for several years, and the filing of draft papers would mark a significant step towards its eventual public debut.

NSE, the country’s largest exchange, is likely to submit IPO papers with the Sebi today, people familiar with the developments told Fortune India.

In February, NSE's board approved proceeding with the IPO through a pure offer-for-sale (OFS) route, enabling existing shareholders to partially monetise their holdings. The exchange had received a no-objection certificate (NOC) from Sebi in January this year, paving the way for the next phase of the listing process.

The exchange ownership is widely distributed among domestic and global financial institutions, insurance companies, and individual investors, with no single shareholder holding a controlling stake.

Trading members, along with their associates and agents, collectively hold about 35.51% of the NSE. Among domestic institutional investors, Life Insurance Corporation of India (LIC) owns 10.7%, followed by Stock Holding Corporation of India Ltd (4.4%), SBI Capital Markets (4.33%), and State Bank of India (3.23%). Other key shareholders include GIC, New India Assurance, and National Insurance Company.

Prominent foreign investors in the exchange include Aranda Investments (Temasek), Canada Pension Plan Investment Board (CPPIB), Morgan Stanley's MS Strategic Mauritius, and Crown Capital.

To manage the IPO process, NSE appointed 20 merchant bankers in March, including Kotak Mahindra Capital, JM Financial, Axis Capital, IIFL Capital Services, Motilal Oswal Investment Advisors, ICICI Securities, SBI Capital Markets, Nuvama Wealth Management, HDFC Bank, Avendus Capital, Morgan Stanley India, Citigroup Global Markets India, J.P. Morgan India, HSBC Securities and Capital Markets India, IDBI Capital Markets & Securities, 360 ONE WAM, Anand Rathi Advisors, DAM Capital Advisors, Pantomath Capital Advisors, and Equirus Capital.

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