णो नः

Operational rule vidhi

A णकार present at the beginning of औपदेशिक form of a धातु is converted to नकार.

Word by word (padaccheda)

Target णः ṣaṣṭhī · ekavacanaSubstitute / term नः prathamā · ekavacana

Target Ṣaṣṭhī (6th case): names what gets replaced, "in place of X" (1.1.49 षष्ठी स्थानेयोगा).
Substitute / term Prathamā (1st case): in operational rules, the substitute or the thing introduced; in definitions, the term or its referent.

Full reading

णः नः

Pāṇini leaves out words that carry over from earlier sūtras. Expand to see the rule as a reader actually understands it.

As a rewrite rule (sketch from case endings)

णः → नः

Replace ṇaḥ with naḥ. Inherited words (anuvṛtti) may add further conditions.

Commentary

There is the substitution of न् for the initial ण् of the root in the धातुपाठ।
The phrase धात्वादेः is understood here. Thus णीञ् - नयति, णम - नमति, णह - नह्यति ॥ But not अण् - अणति ॥ This does not apply to roots derived from nouns. णकारमिच्छति = णकारीयात ॥The roots are exhibited in the Dhatupatha with ण् for a similar reason as they are exibited with ष ॥ By 8.4.14, these roots change their न into ण when preceded by certain prepositions. All roots beginning with a ण should be understood to have been so taught, with the exception of the following:- नृ, नन्दि नर्दि, नक्क, नाटि, नाधृ and नाथृ ॥

Śrīśa Chandra Vasu, The Ashtadhyayi of Panini (1897), via ashtadhyayi.com.