The National Stock Exchange (NSE) has cautioned investors that the outcome of several regulatory proceedings and court cases remains uncertain, with settlement proposals worth ₹1,491.21 crore in the long-running co-location and dark fibre matters still awaiting approval from SEBI).

In its draft red herring prospectus (DRHP) filed late Thursday, the exchange said it has recognised a ₹1,391.21-crore provision during FY26 towards the proposed settlement after revising the settlement terms submitted to the regulator in March this year.

The co-location matter dates back to 2015, when allegations first emerged that certain brokers received preferential access to NSE’s co-location facility, allowing them to connect to the exchange’s trading servers ahead of other market participants. The dark fibre matter arose from the same broader investigation and relates to allegations that certain brokers received unfair access through dark fibre connectivity. NSE challenged SEBI’s findings in both matters.

Long list of cases

In August 2023, SAT set aside SEBI’s disgorgement direction in the co-location matter and instead directed NSE to transfer ₹100 crore to the Investor Protection and Education Fund (IPEF). SAT had similarly set aside the dark fibre case orders.

SEBI subsequently challenged both rulings before the Supreme Court, where the matters still remain pending.

“The settlement applications are pending for final disposal with SEBI, the future outcome of which is uncertain at this stage,” the exchange said in the risk factors section of the DRHP.

Other pending regulatory matters include SEBI’s appeal before the Supreme Court against a SAT order that set aside a ₹6-crore penalty imposed on NSE and its clearing corporation over investments in activities allegedly not incidental to the business of a stock exchange.

Separately, NSE’s appeal against SEBI’s ₹2-crore penalty in the Karvy Stock Broking matter is pending before SAT, which has stayed the operation of the regulator’s order.

A long-running competition law dispute with Metropolitan Stock Exchange of India (MSEI), where NSE’s appeal against the ₹55.5-crore penalty imposed by the Competition Commission of India (CCI) is pending before the Supreme Court. Separately, MSEI’s compensation claim of ₹856.99 crore before the National Company Law Appellate Tribunal (NCLAT) has been stayed, pending the outcome of the apex court proceedings.

In total, the DRHP disclosed 18 criminal proceedings, 21 material civil proceedings, 43 tax proceedings and six statutory and regulatory proceedings against the exchange. The aggregate amount involved in proceedings against the company stands at ₹2,605.67 crore, excluding matters where the financial impact cannot be quantified.

The exchange said adverse outcomes in these proceedings could materially affect its business, financial condition, cash flows, results of operations and reputation.

The disclosures come as NSE moves ahead with its long-awaited initial public offering after receiving SEBI’s no-objection certificate in January this year. The exchange has filed its offer document comprising entirely an offer for sale (OFS) of 148.91 million equity shares or nearly 6 per cent of NSE’s paid-up capital, at face value ₹1 each, with no fresh issue of shares.

Published on June 18, 2026