Soach Global Set For Substantial Gains In Partial Exit From National Stock Exchange

Soach Global Set For Substantial Gains In Partial Exit From National Stock Exchange

Mumbai, Sep 17: Soach Global Strategic Holdings Limited, Mauritius, a wholly-owned subsidiary of Soach Global Opportunities Fund, is part exiting from its decade-long investment in the National Stock Exchange of India Limited. The Fund is selling through the offer for sale in NSE‘s initial public offering, which opened today.

The Fund acquired 1,50,000 NSE equity shares from Industrial Finance Corporation of India Limited in January 2016 at ₹3,950 per share, aggregating ₹59.25 crore. Over the following decade, the holding multiplied to 82,50,000 shares through corporate actions, without any additional investment. Adjusted for these corporate actions, the Fund’s average acquisition cost is ₹71.8 per share.

The Fund is now selling 16,50,000 equity shares, which is 20% of its holding, at the IPO price band of ₹1,700 to ₹1,785 per share, valuing the sale at approximately ₹280 to ₹295 crore. This realises nearly five times the Fund’s entire original investment, a return of roughly 25x. The Fund will continue to hold 66,00,000 shares, 80% of its position, valued at approximately ₹1,120 to ₹1,180 crore at the price band.

“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. As these retail investors buy small stakes in NSE, directly or indirectly through mutual funds, they will also benefit from the growth of NSE, the same way we have by buying our stake over ten years ago. Of India’s 1.4 billion people, only about 130 million are registered investors on NSE, and that is the opportunity,” said Anubhav Dayal, Founder & Director, Soach Global Opportunities Fund.

“In our country, we have a culture of buying gold at a festival or for a ceremony. Gold, once purchased by a family, is held for a long time, even generations. It is sold only when in desperate need of money. Retail buyers can compare shares of NSE with buying gold. As a multi-asset-class trading platform, NSE will book growth in revenue while operating at a fixed cost, most of it already incurred. It is a high-technology platform settling trades in nanoseconds, and a multi-asset-class exchange: equity, commodities, electricity futures, bond index futures and coal. As India develops, the list of tradable products will only increase, adding to revenues on a largely fixed cost base. This will reflect in its price per share post-listing. This is a one-way partial exit and we have no plans of re-entering,” he added.