Nithin Kamath, founder and CEO of India's largest brokerage firm Zerodha, recently took to LinkedIn to express his deep sense of obligation and gratitude towards the National Stock Exchange (NSE) ahead of its highly anticipated initial public offering (IPO).
NSE's Crucial Role in Zerodha's Genesis
Kamath highlighted that the NSE played a pivotal role in Zerodha's establishment and growth. He recalled that in 2010, one of the primary reasons Zerodha even considered becoming a brokerage firm was the introduction of 'NSE NOW'. This was a free trading platform provided by the NSE, which brokers could offer to their clients, significantly lowering the barrier to entry for new firms without the resources to build their own systems.
Beyond the platform, Kamath recounted a particularly impactful gesture from the exchange. When Zerodha approached the NSE for membership in Chennai, the experience starkly contrasted with the 'scary stories' he had heard about dealing with exchanges. He stated that the NSE officials were incredibly welcoming and, upon realizing Zerodha's nascent financial position, even waived their membership fee of approximately ₹5 lakh.
"In many ways, we are around only because of the NSE. When we started, we didn't have the money to build our own trading platform. If there is one company I personally feel a sense of obligation towards, it is the NSE," Kamath wrote.
Optimism for the Upcoming NSE IPO
Regarding the impending IPO, Kamath conveyed his strong belief in its success. "Given that it is NSE, I have no doubt that it will be a successful IPO," he remarked, clarifying that his comments were not an investment recommendation.
NSE IPO Details
- Subscription Dates: The NSE IPO is scheduled to open for public subscription on September 17 and will close on September 21.
- Anchor Book: The anchor book will open a day earlier, on September 16.
- Issue Size: The offering comprises an Offer for Sale (OFS) of 12.64 crore equity shares.
- Price Band: The price per share has been fixed between ₹1,700 and ₹1,785.
- Estimated Fundraise: At the upper end of the price band, the IPO is estimated to raise approximately ₹22,569 crore. As an OFS, proceeds will go to selling shareholders.
- Grey Market Premium (GMP): The Grey Market Premium (GMP) for NSE IPO stood at ₹210, implying a potential listing price of ₹1,995, an 11.76% premium over the upper issue price. However, GMPs are unofficial indicators.
- Listing Date: The tentative listing date for NSE shares is September 24.
Kamath's endorsement underscores the significant impact institutional support can have on emerging businesses, highlighting a unique aspect of the relationship between a major exchange and a disruptive brokerage firm.