Defying the drift in an eccentric equity market that saw shareholders? wealth falling steeply, the total valuation of the National Stock exchange (NSE) surged by Rs 553.5 crore in just two weeks.
On Friday, when Corporation Bank sold around 1.20 lakh NSE shares to Fidelity Equity Fund and HDFC Ltd, the lender had realised Rs 2,900 per equity share. This was Rs 122.23 more than what Financial Technologies had paid for picking up 1% NSE stake on August 23, 2007.
Corporation Bank sold around 1.27 lakh shares or 0.27% of the paid-up equity capital of the country?s largest stock exchange to Fidelity Equity Fund and HDFC Ltd for an aggregate sum of Rs 35.01 crore. This transaction puts the NSE?s per-share valuation at Rs 2,900 per equity share. This works out to a total of $3.2 billion (about Rs 12,960 crore)
When Financial Technologies bought 4.5 lakh equity shares ? 1% of the NSE ?on August 23 from ICICI Bank, it had spent Rs 125 crore. In this transaction, the NSE?s per-share valuation was at Rs 2,777 per equity share.
An industry analyst, who did not wish to be named, said, the willingness of strategic investors to pay more for a minority NSE stake in the two weeks reflected the high potential and future growth opportunities that lay ahead for the bourse. When reached for comment, NSE executives said, ?We do not have any comments to offer as the recent transaction was between two investors of the exchange.?
At present, the NSE generates a daily turnover of nearly Rs 10,000 crore in the cash market alone. Besides, the NSE has a highly developed and liquid derivatives market that generates a turnover in a range of Rs 50,000-70,000 crore daily.