Why NSE stands out as a ‘cash generation and distribution machine'? Zerodha's Nithin Kamath explains

Zerodha's Nithin Kamath has called NSE a cash generation and distribution machine ahead of its around Rs 30,000-crore IPO, noting that the exchange earned over Rs 10,300 crore in FY26 and distributed approximately Rs 8,660 crore as dividends, an 84% payout ratio. Kamath said dividend payouts are likely to continue post-listing since SEBI does not allow exchanges to invest in other businesses. He attributed the scarcity of such high-payout firms in India to a tax arbitrage, where combined corporate and dividend tax can reach about 51% versus around 14.5% capital gains tax, incentivising companies to reinvest profits rather than distribute them.