NSE Investments to Sell 20% Stake in Protean eGov via OFS

NSE Investments Ltd., a subsidiary of the National Stock Exchange (NSE), is planning to sell up to 20.32% of its stake in Protean eGov Technologies Ltd. through an Offer for Sale (OFS). This translates to around 82.35 lakh shares, worth approximately Rs.1,276 crore. The sale includes a base offer of 41.17 lakh shares (10.16%) and a green shoe option for another 41.17 lakh shares.

The OFS opens for non-retail investors on November 22, while retail investors and unallocated bidders get their chance on November 25. The floor price has been set at Rs.1,550 per share.

Who is Protean eGov?

Protean is known for its e-governance services, managing large scale projects like the National Pension Scheme (NPS) and Atal Pension Yojana. They’ve also ventured into account aggregation, a field regulated by the RBI.

Financially, the company has had mixed results. In Q2FY25, their net profit dropped by 15% year-on-year to Rs.28 crore, compared to Rs.33 crore the previous year. However, quarter-on-quarter, profit jumped by 33%. Revenue, on the other hand, fell 7% to Rs.220 crore from Rs.236 crore in Q2FY24.

What’s Next if NSE Exits?

If the entire stake is sold, NSE Investments will exit Protean completely. This follows a similar step by Standard Chartered Bank, which sold its 3.09% stake in Protean for Rs.225 crore earlier this year.

Market Performance 

Protean’s shares have been performing well, rising 66% in the last 12 months and 47% year-to-date. Today, on November 21, the stock is trading over 9% lower at Rs.1,679.90 , it saw some volatility this week.

Conclusion: This stake sale is a major development for both NSE Investments and Protean. While it might shift ownership dynamics, Protean’s position in e-governance makes it a company to watch. Investors should keep an eye on how the OFS impacts market sentiment.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.