1. Investment Analysis of BSE Ltd.
2. Valuation of BSE Ltd.
3. Valuation of subsidiary companies of BSE Ltd.

DOCUMENT DESCRIPTION

Rationale for the Model

BSE Ltd. (formerly Bombay Stock Exchange Ltd.) is Asia oldest and India's first stock exchange, established 1875.

BSE Ltd. aims to go public and is likely to file a draft red herring prospectus (DRHP) with India's stock market regulator Sebi, over the next few months. Accordingly, the IPO could take place sometime in early-to-mid 2017.

This model contains historical financial data for BSE Ltd. for the last decade, i.e., for the financial years 2006-07 through 2015-16, based on consolidated financial statements. The data has been collated from BSE's annual reports for these ten years, and manually hard-coded into the model.

Indian regulations have been recently altered so as to permit individual foreign investors to acquire upto 15% equity stake in stock exchanges. The limit on investment by foreign investors such as overseas banks, insurers, stock and commodity exchanges and depositories has been raised from 5% to 15%. This is likely to lead to some of the existing investors increasing their stake via the IPO. Also, foreign portfolio investors too will be permitted to acquire shares in BSE via IPO and secondary market. As such, the IPO could generate considerable interest from investors, global and local alike.

The unlisted shares of BSE Ltd. have already started exchanging hands in India, in the run-up to the IPO. This model will enable such investors, who are looking to invest in the unlisted shares or the IPO, to carry out financial analysis of the exchange.

The model does not contain earnings estimates for the exchange. However, you can plug in your own estimates of earnings, into the columns provided.

The model does not constitute a recommendation to buy or sell shares of BSE Ltd., or investment advice.

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