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The National Stock Exchange of India Ltd (NSE) has hired four additional investment banks for its initial public offering (IPO) and is likely to file its share-sale documents with the markets regulator by December end, four people aware of the development said.

The four additional banks hired by NSE are all domestic banks, one of the four people said, requesting anonymity as he is not authorized to speak to reporters.

“NSE has appointed IDFC Bank Ltd, ICICI Securities Ltd, IIFL Holdings Ltd and HDFC Bank Ltd to the syndicate for which it had earlier hired four other banks.

“These banks have been appointed in the past week or so. This will be the final list of banks for the syndicate, they won’t be adding any more banks now," the person said.

On 23 August, NSE named Citigroup Global Markets India Pvt. Ltd, JM Financial Institutional Securities Ltd, Kotak Mahindra Capital Co. Ltd and Morgan Stanley India Co. Pvt. Ltd as global coordinators for its plan to go public. Cyril Amarchand Mangaldas was appointed legal adviser.

With more banks on board, the exchange is targeting to file its share-sale documents with Securities and Exchange Board of India, or Sebi, by the end of the year, the second person cited above said, also requesting anonymity.

In June, NSE said it plans to file IPO documents in January and will also seek an overseas listing by April. “Multiple processes are on at the moment, the most important one being that of investors tendering their shares for the offer for sale. This process is expected to be closed by end of the month. Work on the draft documents will begin this week and the target is to complete the filing by end of December," said the second person cited above.

NSE’s IPO will be a pure offer for sale (OFS); the exchange is planning to offer at least a 20% stake to investors. “We can hardly comment on any of these issues unless the listing committee which is working on the matter decides to do so. We continue to focus on DRHP (draft red herring prospectus) filing by January. There is no mandate to announce any earlier time frame as of now," said an NSE spokesperson over email.

Emails sent to ICICI Securities and HDFC Bank went unanswered. IIFL Holdings and IDFC Bank declined to comment.

On 20 September, Mint reported that bankers for NSE are asking investors to sell a part of their holding in the bourse’s proposed initial share sale at a price that values the bourse at Rs45,000 crore.

The proposed valuation is around two-and-a-half times the price at which shares last changed hands. In July, State Bank of India (SBI) sold a 5% stake in NSE to Mauritius-based Veracity Investments Ltd for Rs911 crore, valuing the exchange at Rs18,200 crore.

The valuation is being pegged at 30 times NSE’s projected earnings for fiscal 2018, Mint reported.

After its stake sale in July, SBI has a 5.19% stake in NSE. Other major shareholders in NSE include Life Insurance Corp. of India (10.51%), Goldman Sachs (5%), Tiger Global Management (3%) and Citigroup Strategic Holdings Mauritius (2%).

NSE’s rival BSE Ltd, Asia’s oldest exchange, filed its share sale documents in September to sell a 27.43% stake. BSE has hired Edelweiss Financial Services Ltd, Axis Capital Ltd, Jefferies India Pvt. Ltd and Nomura Financial Advisory and Securities (India) Pvt. Ltd and four other banks to manage its initial share sale.

The BSE IPO will see some shareholders, including Singapore Exchange Ltd, sell their stakes in the exchange. BSE has not received Sebi’s approval for the IPO.

With an 86% market share in cash equities and nearly 100% share in equity derivatives, NSE is India’s biggest stock exchange.

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