The landmark listing of National Stock Exchange of India Ltd. is set to deliver a major boost to the country’s primary market, but it will be a significant blow to the booming trade in unlisted shares. The operator of the world’s busiest derivatives market accounted for roughly half of the trading volume in the shadow market, according to an estimate by trading platform Unlisted Zone. Its initial public offering threatens to trigger a sharp drop in activity, forcing platforms that facilitate such transactions to find the next big draw.

As India set consecutive records in IPO proceeds the last two years, the unlisted market emerged as a venue for wealthy individuals and funds to make bet on companies in the listing pipeline. The booming interest fostered an ecosystem of online platforms and specialist brokers that specialize in connecting buyers and sellers. NSE had been a linchpin of the growing market because of its scale, profitability, dominant position and disclosures that mirrored listed companies.

“NSE was quasi-listed,” said Sandipan Roy, chief investment officer at Motilal Oswal Private Wealth. “It spawned an entire industry.” The exchange had 231,378 shareholders ahead of its IPO, more than several listed companies. That compares with fewer than 80 shareholders it had in 2016. Until last year, NSE made monthly disclosures on share transfers. Its last such release in March 2025 showed nearly 15 billion rupees ($170 million) of shares changing hands during the month.

“We expect interest in the unlisted market to remain selective as companies emerge across sectors such as space technology, aerospace, defense, data centers and other new-age industries,” said Rajan Shah, Founder, 3A Capital Services. Companies attracting market interest include Sterlite Electric Ltd, Indofil Industries Ltd, Krasny Defence Technologies Ltd, Berar Finance Ltd, Kineco Ltd, Indian Potash Ltd and Garuda Aerospace Ltd.