NSDL begins talks on planned IPO: Report

National Securities Depository Ltd. (NSDL), India’s first and biggest depository services company, has reportedly begun talks with investment banks for an initial public offering of Rs 4,500 crore, two people privy to the matter told Mint.

Set up in 1996, NSDL had over 27.6 million investor accounts that accounted for Rs. 297.55 trillion of Demat custody as of May 31, 2022.

"NSDL has initiated talks on its planned IPO," a source aware of the development told Mint. "Most top domestic and foreign investment banks are vying for the IPO mandate and the mandates may be finalised in the next few weeks. The IPO is mostly going to be a secondary share sale by existing investors, while some small amount may be raised as part of the IPO. Most company shareholders, including several public sector bank shareholders and other investors, are likely to sell part of their shareholding through the IPO."

Currently, IDBI Bank and the National Stock exchange have the biggest stake in NSDL with both holding 26% and 24% stakes respectively. Besides, State Bank of India, Union Bank of India and Canara Bank have 5%, 2.81%, and 2.30% stakes respectively. Additionally, the Central Government owns 6.83% of the company’s stake through the Specified Undertaking of The Unit Trust of India.

The NSDL IPO is expected to have a total valuation of approximately 16,000 crore, according to the report.

NSDL’s move comes at a time when Demat account openings are witnessing a massive surge after a post-pandemic rally in the stock markets. The total number of Demat accounts in the country is calculated to be around 94.77 million as of May 31, 2022.

DH could not independently verify the Mint report.