India, Sept. 9 -- India's IPO market has been gearing up for potentially its biggest listing event of all time, with the National Stock Exchange itself finally set to go public after years of speculation and regulatory ping-pong. The long awaited listing has turned the stake of every existing NSE shareholder into a real liquidity event with banks, financial institutions and insurers who have quietly held equity in the exchange for years lining up as sellers. A public-sector insurer, which typically holds such strategic stakes at a fraction of their market value, would see a $2 billion IPO as a rare opportunity to earn a significant profit and, moreover, free up capital for its core insurance operations.

Shares of New India Assurance Co...