NSE IPO Gets SEBI NOC: Timeline, Settlement, Next Steps

SEBI clearance ends a long wait for NSE’s listing plans

The National Stock Exchange of India (NSE) has received a long-awaited regulatory clearance to proceed with its initial public offering (IPO), a step that comes after years of delays linked to regulatory and legal proceedings. People familiar with the development said the Securities and Exchange Board of India (SEBI) has issued a no-objection certificate (NOC) to NSE, enabling it to begin the IPO filing process. The approval was issued by SEBI’s department overseeing market infrastructure institutions, a mandatory precondition for exchanges, clearing corporations, and depositories before they approach the capital markets. The development is seen as a key milestone because NSE’s IPO plans have been on hold since its earlier filing cycle nearly a decade ago.

What the NOC allows NSE to do now

With the NOC in place, NSE can formally engage merchant bankers, legal advisors, and other intermediaries to begin preparing its draft red herring prospectus (DRHP). People tracking the process said the exchange could take a few months to finalise its filing. Reports also indicate the IPO itself could reach the market in around 8 to 9 months, subject to regulatory timelines and review. NSE Managing Director and Chief Executive Ashish Chauhan had earlier indicated that once the written NOC is received, work on offer documents would start immediately, and that the listing process could take six to eight months thereafter. The NOC effectively removes the biggest procedural block that prevented NSE from restarting the formal listing path.

Offer for Sale structure, and what it implies

People familiar with the plans said the proposed offering is likely to be structured as an Offer for Sale (OFS). That means the issue is expected to primarily provide an exit route to existing shareholders, rather than raise fresh capital for the exchange itself. The reports explicitly stated that no fresh capital is expected to be raised for the company through this IPO structure. This matters for investors because an OFS-led issue typically centres on valuation, governance disclosures, and clarity on pending matters, rather than funding new expansion.

Settlement process continues alongside IPO preparations

SEBI’s NOC has been issued even as the settlement process linked to NSE’s co-location and dark fibre cases has not yet reached formal closure, according to people familiar with the matter. NSE filed a settlement application with SEBI in June 2025 under the regulator’s consent mechanism. As part of the proposed settlement, NSE has made provisions of ₹1,297 crore in its financials and had deposited an additional ₹100 crore earlier, following a Securities Appellate Tribunal (SAT) order. Reports also said NSE has offered close to ₹1,400 crore to settle the matter, with some coverage citing a settlement proposal of ₹1,388 crore. The final settlement amount may change because interest at 12% is expected to apply until completion.

How the settlement moves through SEBI and the courts

The settlement proposal is expected to be evaluated through SEBI’s internal committee process and then move to a High Powered Advisory Committee (HPAC). After that, it is expected to be placed before SEBI’s whole-time members for final clearance. Once those steps are completed, SEBI is expected to seek withdrawal of the pending case before the Supreme Court, which would formally close the matter. A SEBI official aware of the matter said the regulator’s relevant department has conveyed its no-objection for NSE to proceed with IPO-related filings. Reports also said internal SEBI departments had broadly agreed to the settlement framework, which contributed to the NOC being issued even before final settlement closure.

What NSE has said publicly about the approval

NSE Chairperson Shri Srinivas Injeti welcomed the clearance and linked it to the exchange’s next phase. He said NSE was “delighted to receive SEBI approval for our IPO” and described it as a “significant milestone.” He also said the approval “reinforces confidence in NSE being an integral part of the Indian economy” and spoke of value creation for stakeholders. The comments are significant because they represent the most direct public confirmation from NSE leadership after the regulatory go-ahead.

Background: a decade-long overhang from co-location and other actions

NSE had first filed for an IPO in 2016, but later withdrew as the regulatory probe gathered pace. The timeline referenced in reports highlights key milestones: in 2019, SEBI ordered NSE to disgorge ₹62.58 crore and barred certain senior officials; in 2022, SEBI imposed a ₹7 crore penalty that was later overturned by SAT; and in 2023-24, SEBI appealed the SAT ruling in the Supreme Court. In 2025, NSE filed the settlement application and agreed to pay around ₹1,400 crore as part of the proposal to resolve the co-location and dark fibre matters. The settlement, if completed, is expected to remove a key legacy constraint that has repeatedly delayed a listing.

Disclosures and documentation: what the DRHP will need to cover

Under SEBI rules, exchanges are required to disclose pending regulatory or legal matters in offer documents. Market participants and experts cited in the reports said NSE is expected to make appropriate disclosures in the DRHP, if required, including the status of the settlement process and any ongoing proceedings. The exchange will also need to align its offer document narratives with the continuing settlement workflow, including the role of SEBI committees and the status of the Supreme Court matter. The speed of regulatory review and the completeness of disclosures typically shape timelines from DRHP filing to final approval and listing.

Market context: valuation chatter and unlisted share interest

With the NOC now issued, the long-stalled IPO is seen as materially closer to execution. Based on prevailing unlisted market prices, one report cited an estimated valuation of around ₹5 lakh crore (₹500,000 crore) for NSE, which would place it among the largest potential listings in India’s capital market history if it materialises at those levels. Separately, reports noted heightened interest in NSE shares in the unlisted market, though no specific price data was provided. SEBI’s decision to issue the NOC was also interpreted by market participants as reflecting comfort with the direction of the settlement process, even with final approvals still pending.

Key facts at a glance

Timeline of the regulatory overhang

Why the development matters for investors and the market

For investors, the NOC is a procedural green light that makes the IPO timeline more concrete, even as settlement approvals remain pending. For the broader market, the listing of a key market infrastructure institution can increase public disclosure and accountability, as exchanges must meet higher reporting and governance expectations as listed entities. At the same time, the offer documents are expected to detail the status of the settlement and the remaining steps involving HPAC, whole-time member approvals, and the Supreme Court case withdrawal. The next visible milestones are banker appointments, DRHP drafting, and filing, followed by SEBI’s review process.

Conclusion

SEBI’s no-objection certificate has reopened the formal IPO track for NSE after nearly a decade of regulatory uncertainty, while the co-location and dark fibre settlement continues through SEBI’s internal approval process. The exchange is expected to move toward appointing intermediaries and preparing its DRHP in the coming months, with an 8 to 9 month indicative runway to a potential listing, subject to regulatory timelines and required disclosures.