What Is the National Stock Exchange (NSE)?
Key facts:
- Headquarters: Mumbai, India
- Market Share: Over 90% in equity derivatives and over 80% in cash market
- Benchmark Index: NIFTY 50
- Primary Revenue: Transaction charges, data feed, co-location services, listing fees
NSE plays a crucial role in India’s financial infrastructure. It’s where the majority of equity, debt, and derivative trades take place daily. With over 2,000 listed companies and millions of daily trades, NSE has grown into a profit-generating powerhouse.
NSE’s Journey and Business Model
NSE was established by financial institutions to bring transparency, technology, and structure to India’s capital markets. It eliminated the traditional open outcry system and introduced electronic trading. Over the decades, it expanded into multiple segments:
- Equity and Derivatives Trading
- Debt Market
- Mutual Fund Distribution
- Currency Derivatives
- Commodities (via NSE IFSC)
The exchange also launched subsidiaries like:
- NSE Clearing Ltd. (formerly NSCCL) – handles trade settlements
- NSE Academy – offers financial education
- NSE IFSC Ltd. – operates at GIFT City for global trading
Revenue comes from:
- Transaction fees (charged per trade)
- Listing fees (companies pay to get listed)
- Market data sales
- Technology and licensing fees
- Membership charges from brokers
In short, NSE makes money on every trade that happens on it.
What Are NSE Unlisted Shares?
NSE is not yet a publicly listed company. However, its shares are held by:
- Financial institutions
- Banks
- Private investors
- Employees (ESOPs)
These shares occasionally change hands through private placements, brokers, or online unlisted share platforms. These are known as NSE unlisted shares. They’re legal and valid but are not available on stock market apps like Zerodha or Groww.
They’re stored either as:
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Physical certificates (older holdings), or
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Dematerialized form (most common today, held via NSDL/CDSL)
Why NSE Shares Are So Popular in the Unlisted Market
There are several reasons why investors want to buy NSE shares before they are listed:
✅ Monopoly in Its Sector
NSE controls the largest share of equity and derivatives trading in India. It’s difficult for any competitor to catch up due to its ecosystem, trust, and tech superiority.
✅ Strong Financials
NSE is a cash-rich, debt-free company that consistently posts high profits and dividends.
✅ Upcoming IPO Potential
Though delayed multiple times, NSE's IPO is highly anticipated. Investors expect a huge jump in valuation post-listing.
✅ Limited Availability
NSE shares are not widely available, making them more desirable due to scarcity.
The NSE IPO: Timeline and Delays
The IPO for NSE has been in discussion since 2016, but it has faced multiple delays due to:
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SEBI Investigations into the co-location scam
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Governance issues involving previous executives
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Internal restructuring and compliance challenges
However, in 2023–2024, the company submitted updated Draft Red Herring Prospectus (DRHP) and resumed IPO preparation. Though there’s no official date, analysts expect it may happen by late 2025 or early 2026, subject to SEBI’s approval.
NSE Financials and Growth Trajectory (FY20–FY24)
Over the last five financial years (FY20 to FY24), the National Stock Exchange (NSE) has shown remarkable growth in revenue, profitability, and shareholder value. Below is a detailed financial snapshot that reflects its robust business model, strong operational execution, and steady dominance in the capital markets.
📊 Financial Summary (in ₹ Crores)
| Particulars | FY20 | FY21 | FY22 | FY23 | FY24 | YoY % (FY24) | CAGR % (FY20–FY24) |
|---|---|---|---|---|---|---|---|
| Net Sales | 3,507.9 | 5,624.8 | 8,929.5 | 11,856.2 | 14,780 | 24.7% | 43.3% |
| Total Income | 3,897.5 | 6,202.3 | 9,499.6 | 12,765.4 | 16,433.6 | 28.7% | 43.3% |
| Net Profit | 1,884.8 | 3,573.4 | 5,198.3 | 7,356.0 | 8,406.5 | 14.3% | 45.3% |
| Shareholder Funds | 8,622.0 | 11,636.0 | 15,418.3 | 20,480.4 | 23,973.9 | 17.1% | 29.1% |
| Total Assets | 24,170.3 | 29,205.6 | 35,607.0 | 36,564.3 | 65,464.0 | 79.0% | 28.3% |
| EPS (₹) | 7.62 | 14.44 | 21.00 | 29.72 | 33.97 | 14.3% | — |
- Net Sales jumped by 24.7% YoY, showing consistent growth in trading activity and platform usage.
- Net Profit rose by 14.3%, crossing ₹8,400 crore — reflecting strong operational efficiency.
- EPS stood at ₹33.97, marking a CAGR of over 40% since FY20.
Key Takeaways from the Financials:
✅ Consistent Revenue and Profit Growth
NSE's Net Sales grew at a 5-year CAGR of 43.3%, showing how fast India’s capital markets are expanding — and how NSE is profiting from this boom. The Total Income shows a similar trend.
✅ Strong Profitability
Net Profit nearly quadrupled from ₹1,884 crore in FY20 to ₹8,406 crore in FY24. This indicates efficient operations, low debt, and strong margins.
✅ Solid Balance Sheet
Shareholder Funds rose from ₹8,622 crore in FY20 to ₹23,974 crore in FY24 — growing at a CAGR of 29.1%. NSE has remained debt-free and retained most of its profits, which adds long-term value for shareholders.
✅ Asset Growth
The total assets nearly tripled in FY24 compared to FY20. A sharp jump in FY24 shows the company is preparing for strategic expansion, likely in digital infrastructure, technology, and global operations (via IFSC).
How to Buy NSE Unlisted Shares
You can buy NSE shares even though it’s not listed. Here's how:
✅ Step-by-Step Process:
- Find a Seller: Usually a broker, platform, or existing shareholder
- Complete KYC: PAN, Aadhaar, bank details, demat
- Price Negotiation: Based on current demand and recent deals
- Payment via Escrow: For safety
- Share Transfer: Done via SH-4 form and depository (NSDL/CDSL)
Always deal with SEBI-registered brokers or trusted platforms.
Key Benefits of Investing in NSE Unlisted Shares
- Pre-IPO Opportunity: Potential for large gains post-listing
- Safe Business Model: NSE is a financially stable and trusted brand
- Dividends: Pays out regular dividends, even while unlisted
- Tech-Driven Infrastructure: Advanced systems make NSE a future-ready company
- Institutional Trust: Backed by top banks and investors
Major Risks and Challenges
While the opportunity is attractive, there are significant risks:
- ❌ No IPO Guarantee – Still no confirmed date
- ❌ Illiquidity – Hard to sell shares quickly
- ❌ Unregulated Market – Prices are not officially declared
- ❌ Scams and Fake Shares – Fraudsters may sell forged or invalid shares
- ❌ Regulatory Delays – SEBI scrutiny may slow down listing plans
Regulatory and Tax Implications
- ✅ Regulated by SEBI: Though not listed, transfer and ownership rules apply
- ✅ Taxation:
- Held < 2 years: Short-Term Capital Gains (STCG) as per your tax slab
- Held > 2 years: Long-Term Capital Gains (LTCG) @ 20% with indexation
- ✅ IPO Lock-In: 6-month lock-in period post-IPO for pre-IPO shareholders
How to Verify Authenticity of NSE Unlisted Shares
Before investing, ensure:
- The broker is SEBI-registered
- Shares are transferred to your demat account
- You receive a Contract Note and SH-4 document
- Verify with your Depository Participant (DP)
- Cross-check shareholding on NSDL/CDSL statements
📞 You can also contact NSE’s investor desk to verify details.
Who Should Invest in NSE Unlisted Shares?
Ideal for:
- High-net-worth individuals (HNIs)
- Long-term investors looking for wealth creation
- Informed retail investors with understanding of IPO markets
- Portfolio diversifiers wanting exposure to private equity
Not ideal for:
- Those needing short-term liquidity
- Risk-averse investors
- People without proper KYC/demat setup
Final Thoughts
The National Stock Exchange (NSE) is a jewel in India’s financial ecosystem. Its unlisted shares offer a rare chance to be part of this success story before it hits the public market. But like all investments, this too comes with risks—illiquidity, delay in IPO, and pricing ambiguity.If you can wait, do proper due diligence, and invest through verified channels, NSE unlisted shares can be a rewarding long-term bet.
