NSE IPO impact: This PSU insurer hits 52-week high; check its NSE stake and other details

New India Assurance Company (NIACL) shares opened at ₹234.35 apiece on the BSE on Monday, September 7, and gained as much as 5.5% to hit a fresh 52-week high of ₹242.65. The stock, however, failed to hold on to its gains as weakness across the broader market weighed on sentiment. From the day's high, NIACL shares fell as much as 7.5% to touch an intraday low of ₹224.40.

The sharp swings came as the proposed NSE IPO continues to keep the PSU insurer in focus. New India Assurance is among the public sector shareholders of the National Stock Exchange and plans to sell part of its holding through the proposed public issue.

New India Assurance's NSE stake

New India Assurance holds 3.52 crore shares in NSE, representing a 1.42% stake in the exchange. As part of the proposed IPO, the insurer plans to sell 1.05 crore shares through an offer for sale (OFS). Its remaining holding in NSE is expected to stand at 2.47 crore shares following the transaction.

The proposed sale has made New India Assurance one of the PSU shareholders being watched as NSE moves closer to its public-market debut. The potential value unlocking from its NSE investment has also emerged as a key theme around the stock.

NIACL has delivered strong gains across several timeframes. The shares are up more than 18% over the past week and have gained 28% in the last month. Over three months, the stock has risen 50%, while its six-month gain stands at 63%. On a one-year basis, however, the shares are up 16%.

The NSE IPO received a further boost on August 27 when Sebi Chairman Tuhin Kanta Pandey said the market regulator was close to clearing NSE's draft red herring prospectus (DRHP).

NSE IPO: Issue size, shareholders and key details

NSE filed its draft prospectus in June for a public issue that will comprise entirely secondary share sales. The proposed IPO is an offer for sale of up to 14.89 crore equity shares, each carrying a face value of ₹1. The issue represents nearly 6% of NSE's paid-up equity capital.

At the reported valuation, the proposed 6% stake sale could potentially raise around ₹30,000 crore to ₹31,500 crore. If the issue reaches that size, the NSE IPO could become India's largest-ever IPO, surpassing Hyundai Motor India's ₹27,870-crore public issue launched in 2024.

The selling shareholders include State Bank of India, MS Strategic (Mauritius) Limited, Canada Pension Plan Investment Board, Aranda Investments (Mauritius) Pte Ltd, Bank of Baroda, Stock Holding Corporation of India Limited, General Insurance Corporation of India, New India Assurance Company, National Insurance Company and United India Insurance Company.

Existing shareholders are expected to dilute portions of their respective NSE holdings through the offer. SBI Chairman C S Setty has said the bank intends to dilute around 0.65% of its NSE holding. SBI currently owns approximately 3.23% in NSE, while SBI Capital Markets holds around 4.33%.

IFCI also has an indirect connection to NSE through Stock Holding Corporation of India (SHCIL). IFCI owns 52% of SHCIL, which in turn holds approximately 4.4% in NSE. This ownership structure has added to the interest around the proposed IPO and the potential value realisation for NSE's existing shareholders.

With the regulator's clearance of the DRHP nearing and the proposed issue potentially ranking as India's largest IPO, the value of NSE holdings held by existing shareholders such as New India Assurance remains a key factor in the stock's outlook.

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