The number of retail shareholders on the National Stock Exchange (NSE) more than doubled (115%) during the January-March quarter. Experts say this is primarily because of two factors. First, there is an anticipation that the country’s biggest stock exchange will be able to resolve teething issues with the markets regulator and be able to launch its initial public offer sooner than later. Second, a lower entry point of Rs 1,200 per share after the NSE declared a bonus issue of four shares for one in the preceding quarter.
Consequently, the number of retail shareholders now stands at 33,896 from 15,771 in the earlier quarter. Their shareholding also grew from 8.03% to 9.89% during the same period, according to shareholding pattern data sourced from the NSE’s website.
The stake held by high net worth individuals (HNIs) also increased, rising from 7.6% to 9.64%.
Among institutional investors, domestic firms’ holdings declined significantly from 11.25% to 5.44% quarter-on-quarter, while foreign investor holdings (comprising FDI and FPI) rose from 22.48% to 28%.
In the first week of November, the share price of the country’s leading stock exchange was adjusted following a bonus issue (4 shares for every 1 held). As a result, the price dropped to one-fifth of its earlier value, falling from around ₹5,400 per share to approximately Rs 1,200 per share. This lower entry point attracted a wave of retail investors looking to accumulate the stock.
Deepak Jasani, equity research analyst, explained that investors are factoring in two key aspects: the valuation of BSE and the volume trends in the market, particularly in derivatives. According to him, these factors present a strong opportunity for gains once NSE gets listed—an event he expects could happen within the next two or three quarters. NSE command a 74% market share in derivatives turnover in FY2025.
Currently, the BSE’s market valuation stands at Rs 85,822 crore. Based on the weighted average price of Rs 1,342 in March, NSE’s unlisted shares are valued at Rs 3.32 lakh crore. The total trading value of NSE’s unlisted shares surged 67% to Rs 5,846.65 crore in Q4 FY2025, up from Rs 3,498.43 crore in Q3FY25.
Although NSE has been pursuing an IPO since its initial filing in 2016, regulatory challenges have delayed its listing. However, the Securities and Exchange Board of India (SEBI) recently cleared the exchange of any wrongdoing in a long-standing case related to unfair market access—removing a major obstacle to its public debut.
SEBI chairman Tuhin Kanta Pandey said on Wednesday that the regulator is working towards a satisfactory resolution of the remaining issues hindering NSE’s IPO. He affirmed the markets regulator’s commitment to seeing the listing process through.
Additionally, on March 24, NSE began electronically settling trades of its unlisted shares—a move expected to further boost investor interest.
The bourse has restarted its listing process by applying for a No Objection Certificate (NOC) from the market regulator. While the NOC has been filed, the timeline for the IPO remains uncertain, as both parties continue to address key concerns—some of which are fundamental in nature, including corporate governance.