NSE IPO: Five key insights into valuation, market share and commodity playbook

NSE IPO key details

Established in November 1992, National Stock Exchange of India Limited (NSE) operates a vertically integrated, multi-asset exchange combining trading, clearing, settlement, listing, indices and market information services. Its products span cash equities, equity futures and options, currency and commodity derivatives, debt instruments, interest-rate futures and mutual fund transactions.

Is NSE IPO coming at a cheaper or expensive valuation?

As seen from the above table. NSE P/E ratio (Price-to-Earnings ratio) is around 43 at the upper end of the IPO price band. At ₹1,785, it is valued at around 43 times its reported FY26 earnings of ₹41.62 per share, which is lower compared to its competitor BSE which currently trades at P/E of around 48. Purely on a P/E ratio basis, NSE IPO valuation looks decent.

Meanwhile, NSE market capitalisation is expected to be around ₹4.41 lakh crore on upper price band which is more than three times higher than BSE’s current market cap of ₹1.35 lakh crore. NSE IPO is coming out with higher market cap mainly because the company has fundamentally strong business with a clear competitive advantage and near-monopoly in the cash and F&O segment.

Investors and market participants also seem to have taken notice of these valuation metrics and the same is being reflected in BSE’s recent stock performance. Since NSE DRHP filing in June 2026, BSE shares have declined over 22% in less than 3 months, while the P/E ratio corrected from 66.6 to 47.8.

NSE makes 4-times more profit than BSE, but BSE is growing at faster pace

• In FY26, NSE reported net profit ₹16,601 crore in revenue, down 3.1% YoY and ₹10,302 crore in profit, down 15.4% YoY, mainly due to lower income from transaction charges after SEBI has taken several measures to curb Futures and Options (F&O) trading, like increasing the minimum contract value, offering only one weekly expiry per benchmark index.

• But despite lower FY26 profitability, NSE’s PAT is 4.1 times higher than BSE’s net profit. However, BSE is a key challenger and growing at an aggressive pace. BSE reported 63.4% YoY FY26 revenue growth and 88.1% YoY PAT growth.

• BSE’s 3-year profit growth of 222.3% reflects a dramatic turnaround in operations especially in the derivatives contracts (Sensex & Bankex). Meanwhile, NSE 3-year profit growth of 24.04% reflects steady, mature growth rate. Overall, BSE is a fast growing company compared to NSE, but NSE still generates more cash and has near-monopoly in several market segments.

FY26 market share: NSE leads but losing some ground in equity options

• As seen in the above table, NSE is far ahead in terms of market share in several segments which help the company generate massive income in form of transaction charges from traders and investors.

• In the F&O segment, NSE has 99.7% market share based on total turnover, but the story is completely different in the options segment. NSE FY26 market share was 74.7% in equity options (based on premium turnover) which dropped further to 68.4% in Q1FY27. This fall in market share is directly linked to BSE’s aggressive expansion in the derivatives segment. BSE grabbed market share by introducing weekly expiry for its benchmark index SENSEX on every Tuesday carving out dedicated high retail volume.

NSE dominance in passive investing

• Most investors focus on the NSE large market share in cash and derivative segment, but NSE has real moat and dominance business position in passive investing.

• As of March 2026, passive funds linked to NIFTY indices had ₹8.14 lakh crore AUM, representing nearly 73% of India's passive fund AUM.

• The total schemes in index funds and ETFs (excluding gold and silver) in India stood at 644 as of 31 March 2026, according to AMFI data. Of this, 495 schemes track Nifty indices, implying a share of 76.86% as of 31 March 2026. Further, as of 30 June 2026, 509 out of 662 index funds and ETFs (excluding gold and silver) schemes in India track NIFTY indices implying a share of 76.89%.

• This near-monopoly in the passive fund market creates an alternative source of revenue for NSE in the form of licensing charges which has grown steadily from ₹97.5 crore in FY24 to ₹152 crore in FY26.

NSE moving beyond stocks and derivatives into commodity

• In recent years, NSE has aggressively diversified beyond stocks and derivatives by introducing electricity futures on its platform in July 2025. NSE had a market share of 71.38% in the number of lots traded in electricity futures during the 14 July 2025 to 31 March 2026 time period. NSE has also introduced gold futures contracts recently with new products such as 10-gram gold futures contracts.

• NSE announced a new collaboration with S&P Global Energy to launch derivatives on Platts benchmarks, followed by the launch of Dated Brent Crude Oil (Platts) Futures.

• In June 2026, NSE incorporated a new subsidiary, National Coal Exchange of India Limited. Once operational, exchange traded coal would introduce standardised contracts and a transparent reference price.

• In July 2026, NSE introduced Indian Natural Gas Futures in its commodity derivatives. The contract is cash settled with a trading unit of 250 million British thermal units ("mmBtu"), referenced to the Indian Gas Exchange ("IGX") Gujarat (Dahej) delivery hub.

Disclaimer:

Investments in the securities market are subject to market risk. Read all the related documents carefully before investing. The stock and IPO details discussed in this article is only for educational purposes and not a buy or sell recommendation. Investors are advised to conduct their own analysis and risk due diligence before trading and investing in the stock market.