Shares of BSE, India’s oldest stock exchange, jumped 14% on Monday, reaching a new 52-week high of ₹3,794. Investors are excited because they believe that the potential IPO of NSE could boost BSE’s stock value further.
Over the past year, BSE shares have surged nearly 200%. This is because market exchanges like BSE benefit significantly during a bull market with rising retail participation.
In addition, NSE has announced a 4:1 bonus share issue, with November 2 set as the record date. This follows a recent decision by SEBI to dismiss a case against NSE officials, which had been a hurdle for the NSE’s IPO plans.
The NSE had previously faced issues related to the co-location scam, where some brokers had unfairly fast access to trading systems. With this case now cleared, the path seems open for NSE to move forward with its IPO plans.
NSE’s chief, Ashishkumar Chauhan, mentioned at the company’s AGM that NSE will soon seek SEBI’s approval to file its draft IPO papers. This comes after a previous attempt in 2016 was withdrawn amid various allegations.
BSE shares have risen by 170% in the past year. Despite a 40% drop in net profit for BSE in the June quarter compared to the previous year, revenue from operations saw a massive increase. NSE, meanwhile, reported a 39% rise in profit and a 51% jump in revenue for the same period.
NSE is set to list only on BSE, as exchanges cannot list on their own platforms. BSE’s shares are also listed on NSE.
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