A Guide to NSE’s Electronic Bidding Platform and Debt Listing
CS Neeraj Jain
Mr Neeraj Jain is the Partner of Expert Global Consultants Private Limited
A SEBI Registered Category -1 Merchant Banker
operating out of New Delhi and providing Pan India Services
Introduction
For nearly three decades, the National Stock Exchange (NSE) has played a vital role in modernizing India’s financial markets. It has introduced industry-leading innovations in market practices, trading platforms, and financial products. Today, NSE stands among the world’s top multi-asset exchanges, holding a significant position in equity, derivatives, and debt markets.
NSE’s Key Milestones
NSE has been instrumental in transforming the Indian capital markets, introducing several firsts, such as:
- The launch of electronic trading
- Co-establishing India’s first depository
- Setting up the first clearing corporation
- Pioneering internet-based trading
- Creating a nationwide trading infrastructure
- Offering co-location facilities for high-frequency trading
Additionally, NSE has been the world’s largest derivatives exchange for four consecutive years and ranks among the top three in cash equity trading globally.
NSE’s Debt Market Segment
For companies aiming to list debt instruments on NSE, compliance with SEBI’s Issue and Listing of Non-Convertible Securities (NCS) Regulations, 2021, is essential. The primary eligibility criteria include:
- A paid-up capital of at least ₹10 crores or a market capitalization of ₹25 crores (for unlisted entities with a net worth exceeding ₹25 crores)
- Obtaining in-principal approval for listing
- Appointing a debenture trustee for debt security issuance
- Acquiring a credit rating from a recognized rating agency
- Setting up a recovery expense fund with the designated exchange
Issuers must also provide key disclosures such as placement memorandums, board resolutions, and financial reports for the past three years.
Overview of NSE’s Electronic Bidding Platform (EBP)
The NSE’s Electronic Bidding Platform (EBP) offers a secure and efficient system for corporate bond issuance via private placement. With a broad network of 785 investors and 82 arrangers, the platform enables:
- A wider investor base and enhanced price discovery
- End-to-end advisory support for corporate bond issuances
- A secure and confidential bidding process
When is NSE-EBP Required?
Private placement of debt securities and Non-Convertible Redeemable Preference Shares (NCRPS) must be conducted through NSE-EBP under the following conditions:
- If a single issuance, including any green shoe option, is ₹50 crores or more
- If a shelf issuance across multiple tranches in a financial year reaches ₹50 crores or more
- If the total value of previous private placements in a financial year equal or exceeds ₹50 crores
- If the issuing entity has been in existence for less than three years
- If the issuance involves regulatory capital instruments like Perpetual Debt Instruments (PDIs) under RBI norms
Issuance Process on NSE-EBP
The electronic bidding and listing process follows a systematic approach:
- Initiation & Notification: Issuers provide an issuance notification at least two working days before bidding (or five days if they are first-time issuers).
- Bidding Phase: Investors place bids during the allocated time, either through an open book (where bid amounts are visible in real-time) or a closed book (where only the total bid amount is shown).
- Bid Acceptance & Settlement: Once bidding concludes, issuers finalize allocations, and funds are transferred through either a clearing corporation or an escrow account within T+1 or T+2 days.
- Security Allocation: After settlement, the allotted securities are credited to investors’ accounts, completing the transaction.
Key Features of NSE-EBP
- A web-based platform secured with OTP authentication
- A dual-approval (maker-checker) process for issuers
- Automated email notifications for all participants
- Multiple allocation methods, such as uniform or multiple yield allocation
Conclusion
NSE’s Electronic Bidding Platform and debt listing framework provide a seamless, transparent, and highly regulated mechanism for corporate bond issuance. The platform enhances market efficiency by offering issuers access to a large investor pool while ensuring a fair and structured bidding process. With its commitment to technological excellence and market integrity, NSE remains a trusted leader in the corporate bond space.
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