HDFC Fuels Retail Frenzy for NSDL Shares in Unlisted Market

Individuals lapped up depository shares as private bank pared some of its stake over a year

- Ram Sahgal

Retail appetite for shares of National Securities Depository Ltd in the unlisted market over the past year was met in a significant way by HDFC Bank Ltd, one of the top six selling shareholders in NSDL's ₹4,011.6 crore initial public offering (IPO). The IPO, a pure offer for sale, will open on 30 July.

HDFC Bank was the only significant shareholder that pared its stake in NSDL by 1.99 million shares, or a percentage point, to 7.95% over a year through 23 July, when the depository filed its offer documents with the Securities and Exchange Board of India.

Returns for HDFC Bank at the upper end of NSDL's ₹760-800 offer band would be 702%, or ₹161 crore, as its weighted average cost of acquiring NSDL shares was ₹108.29 apiece on a fully diluted basis.

In an offer for sale, promoters in a listed company sell their shares directly to the public.

Kotak Mahindra Life Insurance Co. Ltd—which doesn't figure among the selling shareholders in NSDL's IPO but held a 2.97% stake in the depository a year before it filed its offer documents—also pared its stake through the unlisted market.