NSE IPO listing: GMP hits new low of ₹43; can the exchange surprise Street expectations?

The grey market premium (GMP) for the National Stock Exchange of India (NSE) IPO has fallen sharply to ₹43, its lowest level since the issue opened for bidding, ahead of the country’s largest exchange debut on the BSE on September 24.

The latest GMP implies an estimated listing price of ₹1,828 against the upper end of the IPO price band of ₹1,785, pointing to a potential listing premium of around 2.4%, according to data available on InvestorGain.

The sharp moderation in the unofficial premium comes despite strong demand for the ₹22,562 crore IPO, which was subscribed 5.68 times during its September 17-21 bidding window. The issue received bids for 50.58 crore equity shares against 8.86 crore shares on offer, translating into demand of around ₹90,000 crore.

The GMP has steadily weakened since the IPO opened. It stood at ₹142 on September 17, fell to ₹111 on September 18 and moved to ₹61 on September 19. After touching ₹48 on September 20, the premium briefly rose to ₹65 on September 21 before dropping to ₹43 after allotment.

Over the past 20 days, the GMP has ranged between ₹43 and ₹310, according to grey-market tracking data.

Institutional investors lead IPO demand

The NSE IPO is entirely an offer for sale (OFS), comprising 12.64 crore shares, with no fresh issue of equity. The exchange is valued at around ₹4.45 lakh crore at the upper end of the ₹1,700-1,785 price band.

The issue had also attracted strong interest from anchor investors ahead of the public offer. NSE raised ₹6,746.18 crore from anchor investors, with demand touching nearly ₹1.2 lakh crore, or around 20 times the anchor book size.

Institutional investors led demand during the IPO, with the qualified institutional buyer (QIB) portion subscribed 12.68 times. QIBs placed bids for 31.97 crore shares against 2.52 crore shares reserved for the category.

The non-institutional investor (NII) portion was subscribed 6.54 times, receiving bids for 12.35 crore shares against 1.89 crore shares on offer. Within the NII segment, investors bidding more than ₹10 lakh subscribed 7.78 times, while the ₹2 lakh to ₹10 lakh category was subscribed 4.06 times.

Retail participation was comparatively subdued, with the portion subscribed 1.31 times. Retail investors bid for 5.77 crore shares against 4.41 crore shares reserved for them. The employee quota was subscribed 2.33 times.

NSE had reserved 50% of the issue for QIBs, 15% for NIIs and 35% for retail investors.

The institutional book also saw broad participation. Foreign institutional investors (FIIs) placed bids for 14.03 crore shares, while domestic financial institutions, including banks, financial institutions and insurance companies, bid for 6.80 crore shares. Mutual funds submitted bids for another 5.41 crore shares.

GMPs are unofficial market indicators and can fluctuate before listing. They do not guarantee the actual listing price or any gains for investors.

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