National Stock Exchange, India’s largest bourse, has urged the finance ministry to intervene in the long-standing planned IPO with the SEBI, Reuters reported, citing three sources.
However, NSE has declined any talks with government regarding the IPO. “NSE has not had any correspondence with government of India in last 30 months relating to its IPO,” said the exchange.
The NSE has been trying to list on bourses since 2016. However, it has failed multiple times, either due to regulatory approvals or some scam would come its way. Meanwhile, its rival BSE has been trading since 2017.
The exchange’s decision to seek government intervention in the case marks an escalation in the rare standoff between India’s largest exchange and its markets regulator.
If the regulator clears the IPO, it would help large investors find an exit after years. These investors include Life Insurance Corporation of India, State Bank of India, Morgan Stanley, and Canada Pension Investment Plan Board.
NSE’s latest application for a ‘no objection certificate’ (NOC) approval from the markets regulator was not cleared in March; the letter to the ministry from the exchange came after that. NSE sought NOC in November 2019, twice in 2020, and once again in August 2024.
“The letter requests the Ministry of Finance to engage with the newly appointed SEBI Chairman to address and resolve the concerns raised by SEBI regarding NSE’s pending public offer,” said one of the Reuters sources.
SEBI chairperson Tuhin Kanta Pande previous month, said that SEBI was working to resolve issues surrounding NSE’s IPO but will not allow commercial interests to take precedence over the general public interest.
“Different departments at SEBI had raised concerns. Until all departments are satisfied that issues have been addressed, an NOC is unlikely to be issued,” said Reuters’ second source.
SEBI has flagged governance as one of the main issues behind the approval. Plus, the exchange is not able to appoint a chairman to its board. In response to these allegations, NSE, in its letter to the ministry, blamed the markets’ watchdog for a delay in approving a 2022 recommended candidate for chairman.
According to the letter to the ministry, SEBI raised questions on NSE’s process to appoint top management, while NSE dismissed this claim that its processes are compliant with SEBI rules.
Not just that, NSE has alleged that SEBI is favouring its peer BSE, citing certain decisions on new rules for the futures and options market. It raised questions about the regulator’s “neutrality” as these decisions hurt its business interest.