The National Stock Exchange (NSE) of India is making another big push to go public. It’s officially asked SEBI, the Securities and Exchange Board of India, for a No Objection Certificate (NOC), a key step it needs before moving forward with its long-delayed IPO. If it feels like this has been in the works forever, that’s because it kind of has, this plan has been stuck in limbo for over eight years.

In a letter dated March 28, 2025, NSE made its intentions clear to V.S. Sundarasan, the Executive Director at SEBI’s Market Regulation Department:

“We hereby submit this request letter to SEBI for seeking NOC/permission to take further actions towards listing of shares of NSE including filing the DRHP with SEBI.”

This isn’t the first time NSE has asked for SEBI’s go-ahead. Similar requests were made back in 2019, twice in 2020, and again in August 2024. The very first draft of its IPO paperwork, called the Draft Red Herring Prospectus (DRHP), was filed way back in December 2016. But a mix of regulatory roadblocks and legal troubles have kept the IPO on pause.

In February 2025, SEBI flagged a few concerns in response to NSE’s earlier NOC request. 

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Here’s a quick breakdown of those concerns:

1. Ownership of Its Clearing Arm: SEBI wants clearing corporations to be independent from the exchanges they serve, especially now that multiple exchanges can “interoperate.” But NSE still owns the majority of its clearing subsidiary, NSE Clearing Ltd (NCL). NSE defended this setup, saying it’s within the current rules and also pointed out that other exchanges like BSE and MCX fully own their own clearing arms too. NSE also said it’s open to listing this issue as a risk factor in its IPO documents.

2. Tech Systems and Reliability: SEBI asked about the strength of NSE’s technology infrastructure. In response, NSE shared that it’s made major upgrades over the past few years and hasn’t had a serious outage in four years. Out of 82 recommendations given by McKinsey in 2022, NSE says it’s already completed 65 and is working on eight more.

3. Staffing and Key Roles: There were also concerns about whether NSE had enough people in critical roles. According to NSE, its significantly beefed up its team, from 1,115 employees in FY23 to 1,673 in FY25. The number of staff handling core operations grew from 332 to 590, and those in regulatory, compliance, risk, and investor relations rose from 486 to 710.

4. Legal Luggage: Ongoing legal cases, especially around the infamous co-location controversy is also a sore point. NSE says it’s committed to settling these issues and has even sent SEBI a proposal last August to resolve all pending matters amicably.

A Long Road to the IPO

To rewind a bit, NSE first filed its IPO plans in 2016, hoping to raise around ₹10,000 crore by selling 22% of its shares. But things came to a halt after governance lapses came to light, mainly over how some traders may have misused NSE’s co-location facilities to get an unfair advantage.

Fast forward to September 2024, SEBI dropped charges of market violations against NSE tied to a 2019 version of that case, saying there wasn’t enough proof of collusion. Then, in October 2024, NSE agreed to pay ₹643 crore to settle separate claims related to its algorithmic trading systems. That move helped clear a major roadblock on its path to going public.

What This Means for the Market

There’s a lot of buzz around the potential NSE IPO. People in the finance world are excited because a listing could bring more transparency, stronger corporate governance, and a chance for regular investors to own a slice of one of the biggest stock exchanges in the world.

It might also inspire other market infrastructure companies to consider going public.

For now, SEBI hasn’t officially responded to NSE’s latest request. And NSE is staying tight-lipped. But everyone’s watching, because whatever SEBI decides next could shape the future of NSE’s IPO dream.