Insights into 2024’s Most Valuable Stock Exchanges and NSE’s Upcoming IPO
As the world of finance continues to change and change, stock exchanges around the world are always competing to be the best with regard to market cap as well as total value. In 2024 NSE, the National Stock Exchange of India (NSE) made major strides in securing its spot among the most valuable exchanges around the globe. Below, we look at the top rankings and important financial metrics of the most valuable exchanges.
The Top 10 Most Valuable Stock Exchanges in the world
Here’s a detailed look at the most valuable stock exchanges globally: (as of May 2024)
| Rank (by MCap) | Stock Exchange | Market Cap ($ bn) | Stock YTD Return (%) | PE (Trailing 12 Months) |
|---|---|---|---|---|
| 1 | Intercontinental Exchange | 76.5 | 3.9 | 30.6 |
| 2 | CME Group | 76.3 | 0.6 | 24.1 |
| 3 | London Stock Exchange | 60.8 | -1.0 | 65.3 |
| 4 | Hong Kong Exchanges | 43.1 | -0.9 | 28.4 |
| 5 | Deutsche Boerse AG | 38.0 | 0.2 | 19.8 |
| 6 | Nasdaq | 34.5 | 3.0 | 31.9 |
| 7 | National Stock Exchange (NSE) | 32.8 | 67.0 | 32.0 |
| 8 | Tradeweb Markets | 23.7 | 22.5 | 59.1 |
| 9 | CBOE Global Markets | 19.5 | 3.9 | 24.8 |
| 10 | B3 SA Brasil Bolsa Balcao | 13.0 | -18.5 | 16.2 |
| 19 | BSE | 4.5 | 26.9 | 49.8 |
| 23 | MCX | 2.4 | 22.0 | 239.5 |
Data Source: The Economic Times– May 11, 2024
Highlighting the National Stock Exchange of India
Based on the data provided in the table, the following conclusions can be drawn:
- The National Stock Exchange (NSE) of India has risen to become the world’s seventh-most-valuable stock exchange, with a market capitalization of $32.8 billion. The remarkable rise is due to the NSE’s amazing stock YTD performance to 67% which shows solid growth and investor confidence. Find out the full story regarding NSE India crossing the $1 billion mark in profit.
- The NSE’s price at an earnings multiplier of 30% is at level with the P/E ratio of global average around 32x, suggesting it is valued fairly compared to its competitors.
- In the situation of a developing country the NSE’s P/E ratio of 30 is a valid reason due to its high potential for growth as well as its market dynamics, compared to international counterparts from developed countries where P/E ratios could be viewed as too high.
- Data from the past shows that the global exchanges typically experience large fluctuations in valuation. For example, the London Stock Exchange (LSE) saw a modest increase of 0.08 percent in 2018, but an impressive growth of 109.47 percent in the year 2019.
- In contrast, the NSE has demonstrated stable and predictable growth, averaging 30-35% over the last three years. This consistent growth suggests the NSE is well-positioned to continue performing strongly, potentially outpacing its global peers.
NSE Financial Highlights
₹ in crores
| Particulars | FY 2024 | FY 2023 | Y-o-y growth |
| Total Revenue | 16352 | 12765 | 28% |
| Operating Revenue | 14780 | 11856 | 25% |
| EBITDA | 11611 | 9631 | 21% |
| Profit After Tax | 8306 | 7356 | 13% |
Q4- FY 2024. Read more about NSE India’s 4QFY24 Conference Call
₹ in crore
| Particulars | Q4 FY 24 | Q4 FY23 | Y-o-y growth |
| Total Revenue | 5080 | 3774 | 35% |
| Operating Revenue | 4625 | 3453 | 34% |
| EBITDA | 3610 | 2762 | 31% |
| Profit After Tax | 2488 | 2067 | 20% |
Peer Comparison
₹ in crores
During the year ended March 31, 2024, NSE recognized an expense of Rs. 1,740.97 crores towards the contribution to the Core SGF in the financial statements. Consequently, this expense reduced NSE’s Profit After Tax (PAT) to Rs. 8,305 crores. However, if we add back this contribution:
Revised PAT: Rs. 10,045.97 crores (8,305 + 1,740.97)
Market Cap (as of June 2024): Rs. 301,950 crores
Revised P/E: 30.05 (M cap/ Revised PAT)
Note: Contributions to SGF is under regulatory guideline, this is expected to significantly reduce in coming years. Hence, we are calculating normalised profit by adding back SFG provisioning.
NSE IPO
Indian customers are anxiously awaiting an IPO of the National Stock Exchange (NSE) However, a number of conditions set by the SEBI must be fulfilled first. SEBI has stated that the NSE will be operational without glitches for one year, update its technology, enhance corporate governance, and settle the legal issues pending.
The NSE began talks with Sebi regarding the possibility of an IPO beginning in the month of January. It is aiming to begin the process by September, dependent on approval. However, previous governance concerns as well as an Sebi investigation into allegations of wrongdoing involving preferential access to the co-location facility put off the listing. It was claimed that the exchange mismanaged its colocation facility and granted preference to a few trading members. The former CEO of the exchange, Chitra Ramkrishna, was involved in a co-location fraud. Furthermore the NSE was criticized in 2021 following a major suspension of trading due to technical issues.
In December of 2016, NSE had submitted draft documents to Sebi for its long-awaited IPO. Initial share sales were anticipated to bring in around Rs 10,000 crore. The existing shareholders were seeking to sell 22 percent shares to the general public via the OFS (Offer-for Sale) method.
In 2020, Vikram Limaye, then MD and CEO of NSE, informed PTI, “We have approached Sebi for IPO approval. Once granted, we will proceed with appointing merchant bankers to assist in filing the draft prospectus for the IPO.”
NSE currently boasts 9 crore registered investors, representing over 99% of India’s geographical area, with only 33-35 PINCODES excluded.
The investor base has surged in the past five years, driven by rapid digitisation, increased investor awareness, financial inclusion, and robust market performance. The IPO is expected to launch within 18-24 months.
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