According to sources familiar with the matter, the National Stock Exchange of India Ltd. (NSE) may potentially allow trading of its shares on its own platform after they are listed on the competing BSE Ltd. This move could change trading volumes and open the way for the inclusion of NSE shares in benchmark indices.
The possibility was discussed with international investors during recent presentations regarding the proposed initial public offering (IPO) of the exchange's shares. Under this proposal, NSE shares could trade in a 'permitted to trade' category even if they are formally registered on the BSE.
According to available information, current regulations do not provide for self-listing of a stock exchange. Since NSE is classified as a market infrastructure institution, approval from the Securities and Exchange Board of India (SEBI) would be required to permit the trading of its own shares on its platform.
Discussions are ongoing, and any such decision will ultimately depend on regulatory approval. A representative of NSE did not respond to requests for comment.
Previously, according to the NSE website, the 'permitted to trade' system allows securities to trade on NSE without official listing, while their obligations for disclosure and compliance remain unchanged. In 2019, NSE updated index compliance rules so that such securities could qualify for inclusion in the Nifty indices, which are India's most widely tracked benchmarks. Prior to this, only shares officially listed and traded on the exchange were eligible.
Currently, about 250 companies not listed on NSE trade on its platform under the 'permitted to trade' category. These include Elantas Beck India Ltd., Goodyear India Ltd., and Novartis India Ltd.
Such an agreement could give NSE shares access to liquidity on both exchanges while keeping BSE as the primary listing venue, adding a new dimension to one of India's most closely watched IPOs.
Sources familiar with the situation indicate that NSE expects to receive SEBI approval for the draft prospectus by the end of August and plans to launch the IPO in the second half of September.