Description

NSE announces increases in maximum permissible Interactive IPs across all rack variants and discontinues several restrictions under the CaaS framework, effective February 27, 2026.

Summary

NSE’s Member Service Department has announced updates to its colocation facility under Circular Ref. No. 10/2026 (Download Ref No: NSE/MSD/73068). The changes cover two areas: an increase in the maximum number of permissible Interactive IPs across all rack variants, and significant relaxations to the Colocation-as-a-Service (CaaS) framework, including removal of multiple restrictions on members and vendors.

Key Points

  • Maximum permissible Interactive IPs increased for all rack variants: HPD (2×60 → 2×80), Full Rack (60 → 80), Half Rack (30 → 40), Quarter Rack (15 → 20)
  • CaaS vendors may now apply for any rack variant (HPD, Full, Half, or Quarter) based on business requirements
  • Per-rack member limits for CaaS discontinued: previously max 60 members per Full Rack and 30 per Half Rack
  • Restriction limiting members to contracts with a maximum of 2 CaaS vendors at any time is discontinued
  • Limit of 4 order connectivities per member-CaaS vendor combination is discontinued
  • The exclusive-choice directive (independent rack OR CaaS vendor) is discontinued with immediate effect, allowing members to use both simultaneously

Regulatory Changes

These changes partially modify section II.A and section IV of Exchange circular NSE/MSD/67756 dated April 29, 2025 (the colocation consolidated circular). The following restrictions are formally discontinued:

  1. Maximum member-per-rack limits under the CaaS framework (60 per Full Rack, 30 per Half Rack)
  2. The one-contract/maximum-two-vendor restriction for members availing CaaS services
  3. The cap of 4 order connectivities per member-CaaS vendor combination
  4. The directive requiring members to choose exclusively between an independent rack or CaaS vendor

All other provisions of NSE/MSD/67756 remain unchanged.

Compliance Requirements

  • Colocation participants and CaaS vendors should note the revised IP limits and updated CaaS framework immediately
  • Members wishing to apply for additional IPs or new rack variants under the revised framework must await a separate circular that will communicate the rollout timeline and digital acceptance process
  • Members may now hold both an independent rack and a CaaS vendor arrangement concurrently; no action is required to exercise this flexibility
  • CaaS participants must continue to adhere to maximum power consumption limits set by the Exchange

Important Dates

  • February 27, 2026: Circular issued; discontinuation of the exclusive-choice directive (independent rack vs. CaaS) takes effect immediately
  • TBD: Rollout timeline and digital acceptance process for IP limit increases and CaaS framework changes will be communicated via a separate circular

Impact Assessment

This circular benefits colocation participants and CaaS vendors by materially increasing operational flexibility. The IP limit increases (33% uplift across all rack variants) allow higher-density deployments without requiring rack upgrades. Removing the member-per-rack and vendor-contract caps reduces friction for both vendors scaling their CaaS businesses and members diversifying colocation arrangements. The elimination of the exclusive-choice rule is particularly significant as it allows members to run hybrid setups. These changes are expected to improve competitiveness and capacity utilization within NSE’s colocation facility.

Impact Justification

Operational update affecting colocation participants and CaaS vendors; increases IP limits and removes several restrictions improving flexibility, but does not affect broader market trading or listed securities.