IFCI shares jumped another 6% on Monday after SEBI approved the much-awaited IPO of the National Stock Exchange (NSE), clearing a key hurdle for its planned listing. The stock jumped to ₹107.36 apiece on Monday morning, extending its rally as the regulatory approval removes a major overhang. SEbi approved NSE's draft offer document on Friday, according to its website, marking a significant milestone in the exchange's long-awaited listing process. The approval comes after unconfirmed reports suggested the IPO could be launched this month, with SEBI having moved closer to approving NSE's IPO after settling key regulatory cases. The exchange seeks a valuation of up to ₹5.26 lakh crore ($55 billion).
Five public sector insurance firms are set for a windfall pegged at about ₹7,200 crore from the sale of 40 million National Stock Exchange shares in the bourse's proposed IPO, according to the draft prospectus. General Insurance Corporation of India will lead the pack, followed by New India Assurance, National Insurance, United India and Oriental Insurance, who acquired the shares for ₹6.8 crore and are poised to book hefty gains in the second quarter from the IPO. The five insurers' combined stake - totalling 165 million shares - will fall from about 6.7% to 5.1% of NSE's equity. At ₹1,800 a share, their remaining holdings would be worth about ₹13,100 crore, creating scope for a mark-to-market gain once NSE is listed. National Insurance, United India and Oriental Insurance together hold about 90 million NSE shares and will retain roughly 73 million after selling about 17 million shares.
The IPO could boost second quarter profits for the five insurers and provide a capital boost to state-run general insurers seeking to strengthen weak solvency buffers. Industry officials estimate the revaluation could improve solvency ratios, potentially by close to 100 basis points for some of the insurers. As of March 2025, Oriental Insurance reported a solvency ratio of negative 1.03, followed by National Insurance at negative 0.67 and United India Insurance at negative 0.65. LIC, which holds 265.28 million NSE shares, or 10.72% of the exchange, is not selling any and has also secured the right to nominate a director to the exchange's governing board. The proposed IPO, expected later this month, is entirely an offer for sale of up to 148.91 million shares, with NSE itself will not receive proceeds from the issue.
IFCI shares touched an intraday high of ₹107.36 per share, marking a new all-time high despite tepid movement in key benchmark indices. According to market experts, IFCI shares have given a technical breakout at ₹95 and appear bullish on technical charts. Sumeet Bagadia, Executive Director at Choice Broking, noted that the PSU stock is looking strong on technical charts and may bounce back after profit-booking at the new 52-week high. He recommends holding the stock with a stop loss at ₹90 for short-term targets of ₹110 and ₹120 over the next one to two months. Mahesh M Ojha from KC Securities suggests considering buying IFCI shares at around ₹92-₹95 range, with potential targets of ₹102, ₹108 and ₹120+ in the short-term time horizon. The stock has demonstrated remarkable performance with 25% gains in one month, 80% in six months, and a whopping 750% returns in the last five years. From a technical perspective, IFCI's 14-day Relative Strength Index (RSI) stands at 71.7, indicating an overbought zone, while the stock is currently trading above all eight key Simple Moving Averages (SMAs), showing strong underlying price momentum.
The IPO, expected to raise around ₹30,000 crore, will comprise an offer-for-sale (OFS) of up to 14.89 crore equity shares. The filing would mark the culmination of a long listing process first initiated in December 2016, when NSE filed its first DRHP for a ₹10,000-crore issue. IFCI has indirect exposure to NSE through its majority stake in Stock Holding Corporation of India (SHCIL), which in turn, holds over 4% stake in NSE. Through its controlling interest in SHCIL, IFCI enjoys indirect exposure to NSE, making its stock particularly sensitive to developments related to the exchange's IPO. The grey market premium (GMP) jumped to ₹250-280 per share soon after the regulatory nod on Friday evening, from around ₹150-180 earlier in the day, according to grey market brokers. Also read | NSE grey market premium soars on Sebi's IPO approval.
