NSE accelerates share transfer process for IPO prospects

The National Stock Exchange (NSE) of India is making a significant change that will speed up the process of transferring its shares. Starting Monday, shares can be credited to a buyer’s account in just a few days, rather than taking 2 to 4 months. This change could help pave the way for NSE’s initial public offering (IPO). This new process is related to a circular issued by the Securities and Exchange Board of India (Sebi) in October 2024, which focused on improving the shareholding rules for major market institutions. The changes, which had been delayed, will allow shares to be transferred more easily through a delivery instruction slip mechanism. Many industry officials believe this faster transfer will boost interest in NSE's unlisted shares. Currently, the lengthy transfer process makes these shares less appealing compared to those of other unlisted companies that do not face the same regulations. NSE had applied for a no-objection certificate from Sebi in August to move forward with its IPO plans, and it is still awaiting approval. Market experts say that easing the transfer process will likely increase demand and could lead to a temporary rise in share prices. With the new system in place, smaller investors should find it easier to buy NSE shares. Previously, high transaction costs and complex steps discouraged many from participating in the market. NSE’s largest shareholders include the Life Insurance Corporation of India and various investment firms, with a total of 20,444 shareholders. Currently, NSE holds a dominant position in the Indian cash equity and equity options markets.