Soach Global Strategic Holdings Ltd., a Mauritius-based subsidiary of Soach Global Opportunities Fund, is making a partial exit from its long-term investment in the National Stock Exchange of India (NSE). The fund is participating in the NSE's initial public offering (IPO) by selling a significant portion of its shares, expecting extraordinary returns.
Significant Gains from Decade-Old Investment
The fund plans to offload 1.65 million NSE equity shares, which represents 20 percent of its total holding, through the offer for sale (OFS) component of the IPO. This strategic move is projected to yield nearly 25 times the original investment, translating into a substantial profit.
Soach Global initially acquired 150,000 NSE equity shares from IFCI Ltd. in January 2016 at a price of Rs 3,950 per share, totaling an investment of Rs 59.25 crore. Over the years, through various corporate actions and without any additional capital infusion, the fund's holding expanded to 8.25 million shares. After adjusting for these actions, the average acquisition cost for Soach Global stands at an impressive Rs 71.8 per share.
With the NSE IPO priced in the band of Rs 1,700-1,785 per share, the sale of 1.65 million shares is estimated to fetch between Rs 280 crore and Rs 295 crore. This partial divestment alone is expected to realize nearly five times Soach Global's entire original investment.
Future Outlook and Retail Participation
Following this sale, Soach Global will retain a substantial stake of 6.6 million NSE shares, accounting for 80 percent of its current holding. At the IPO price band, this remaining stake is valued at approximately Rs 1,120 crore to Rs 1,180 crore.
“Bharat is a fast-growing economy with a large number of growth-aspiring youngsters who are quickly learning the risks and rewards of participating in capital markets. We are participating in the offer for sale and selling a partial stake of what we own because we would like to see a large number of the mass retail population hold some stake of NSE,” stated Anubhav Dayal, Founder & Director, Soach Global Opportunities Fund.
Dayal emphasized the opportunity for retail investors to benefit from NSE's growth, likening NSE shares to a long-term asset like gold. He highlighted that with only about 130 million registered investors out of India's 1.4 billion people, there is immense potential for market expansion.
The NSE IPO, which commenced its subscription period on September 17 and is set to conclude on September 21, includes an overall OFS of up to 131.1 million equity shares. Dayal affirmed that this is a one-way partial exit for Soach Global, with no plans for re-entry, underscoring their confidence in NSE's future growth as a multi-asset-class trading platform operating on a largely fixed cost base.