Mumbai: The National Security Depository Limited (NSDL)’s upcoming IPO on July 30 is set to be one of the most awaited IPOs to hit the capital markets lately. The market infrastructure institution (MII), is responsible for maintaining shares and other securities in digital formats, has its IPO at Rs.760-800 per share with a minimum lot size of Rs.14,400 for retail investors with the total size of the issue estimated at Rs.4,011.6 crore.
The IPO is a 100% Offer For Sale (OFS) issue, where no fresh capital is expected to be raised. The existing shareholders- SBI, IDBI Bank, NSE and Union Bank are expected to get a 39,900% windfall, where they are selling their investments bought at throwaway prices.
The NSDL has been compelled to undertake this IPO due to SEBI’s regulations. Its largest shareholders IDBI Bank Ltd and NSE, hold 26.10% and 24% of the company, which is in excess of the 15% mandated under the SEBI’s D&P Regulations.
For investors, this offers an opportunity like never before, as the Grey Market Premium (GMP) for the issue is trading at a healthy 18.13% ahead of the IPO. The GMP refers to the unofficial grey market rate for the shares ahead of the IPO. A positive GMP indicates strong investor demand, even though this is a speculative rate and is not regulated by any authority.
Around 5.01 crore equity shares are up for grabs from existing shareholders, including IDBI Bank, NSE, Union Bank of India, SBI, HDFC Bank and SUUTI. After the IPO, NSDL is expected to be valued at Rs.16,000 crore. The company had submitted its Draft Red Herring Prospectus (DHRP) with SEBI in July 2023 initially for 5.72 crore shares and later reduced it to 5.01 crore shares.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Readers should conduct their own research or consult with a qualified financial advisor before making any investment decisions.
