chevron-down Created with Sketch Beta.


Listing of Indian Entities Overseas: A Challenging Landscape

Gokul Rajan, Devaki Mankad, and Vartika Bhatnagar


  • India aims to become a $5 trillion economy by 2027, and access to capital via public markets is vital for sustained economic growth. 
  • Listing on overseas stock exchanges gained traction during the 1990s tech boom, and now declines in depository receipts and foreign currency convertible bonds call for new avenues to capital.
  • While steps have been taken to enable direct overseas listings, challenges remain. Indian regulations, taxation concerns, and compliance costs pose hurdles.
Listing of Indian Entities Overseas: A Challenging Landscape
Tuul and Bruno Morandi via Getty Images


The Indian economy as a whole, and the Indian capital markets, have witnessed tremendous growth in the recent years driven by factors such as strong demand and consumption, increased per-capita income, savings and strong banking system. India is expected to be a US$ 5 trillion economy, being the third largest in the world, by 2027.Promoting inclusive growth, digitizing the economy, technology-enabled development and relying on a virtuous cycle of investment and growth are some of the key measures which the Government of India (“GoI”) is looking to implement in order to achieve the desired outcomes. Access to capital through public markets is a cornerstone of such sustained economic growth.

Indian capital markets facilitated resource mobilization amounting to ₹ 9,800,000 million (approx. USD 119,196.90 million) in financial year 2022-2023.The GoI and securities regulator in India, namely Securities and Exchange of India (“SEBI”), have been very proactive in ensuring continuous and sustained development of the Indian capital market. To enhance the virtuous cycle of investments, SEBI has taken various steps including strengthening disclosure norms for to-be- listed and listed entities, reinforcing corporate governance norms, introducing confidential filing route, and regulating environmental, social and governance investments and ratings.

With an aim to add to the growth of the Indian economy and capital markets, in 2018, SEBI laid out a ground breaking proposal and regulatory initiative to further liberalize equity capital raising framework by allowing listing of equity shares of Indian companies on overseas stock exchanges and of foreign companies on Indian stock exchanges. It would not only enable Indian companies to access foreign capital at a lower cost, but also improve efficient allocation of capital and diversification for investors across the Indian economy. Some of the benefits envisaged to the Indian economy include increased competitiveness for companies incorporated in India as a result of meeting international standards of compliance and oversight, development of finance as a high value-added export, increased access to capital for a growing technology sector, and boosting the “India” brand globally while improving economic relations with other countries.

Evolution of Access to Global Capital Market and Shifting Trends

Capital issuances by Indian companies were strictly controlled by Indian regulators under the erstwhile the Capital Issues (Control) Act, 1947. In November 1993, pursuant to the economic liberalization, GoI permitted listing of equity-linked instruments in foreign markets such as depository receipts (“DRs”) and foreign currency convertible bonds (“FCCBs”) through notification of the Issue of Foreign Currency Convertible Bonds and Ordinary Shares (Through Depository Receipt Mechanism) Scheme, 1993 (“1993 Scheme”). FCCBs became very popular in 1993-1994 when a total of about US$ 1.1 billion was raised through this route. After notification of the 1993 Scheme, in 1999, Infosys Limited was the first ever Indian company to list on U.S. stock exchange (i.e. NASDAQ) through the DR route. Subsequently, in October 2014, GoI notified the Depository Receipts Scheme, 2014 setting out the new liberalized regime for issuance of DRs. This was followed by SEBI introducing a framework for issuance of DRs (for listed or to-be-listed companies in India). While several Indian companies have historically used these routes to list DRs and FCCBs overseas (majority of which belonged to information technology and information technology enabled services sector or financial service sector), there has been a visible decline in popularity of these products in recent years. This broadly corresponds with the growth in depth of the Indian equity market, greater inflow of foreign institutional investor funds, easing of norms for placements by Indian listed companies to institutional investors and cheaper access to domestic and overseas debt.

Number of ADR/GDR Issuances, 2009-2023

Number of ADR/GDR Issuances, 2009-2023

Source: Chapter “Capital Market: Primary and Secondary” of the annual reports of the Reserve Bank of India for periods 2009-10 to 2022-23:

Number of ADR/GDR Issuances, 2009-2023

List of FCCB Issuances, 2005-Present

List of FCCB Issuances, 2005-Present

(Source: Monthly data releases by Reserve Bank of India on External Commercial Borrowing available at

List of FCCB Issuances, 2005-Present

After the initial trend of DRs and FCCBs, Indian companies have also monetized their Indian assets through listing of offshore special purpose vehicles / holding companies or business trusts on the overseas stock exchanges (including Videocon D2H,, Freshworks, Essar Energy Plc, Religare Health Trust, Amira Nature Foods, Azure Power, MakeMyTrip etc). Most recently, we saw the frenzy around the ‘Special Purpose Acquisition Company’ (“SPAC”) concept, which became the buzzword in 2020 and 2021. For instance, ReNew Power, listed on NASDAQ through SPAC route and in 2021. However, such listing have seen limited traction.

Hence, until recently, Indian companies could list securities outside India by way of DRs (underlying existing equity shares), FCCBs (which could be converted into equity shares by way of primary issuance at time of conversion), creating overseas holding structures and thus listing Indian assets (such as MakeMyTrip,, Freshworks, Amira Nature Foods and Azure Power) and through the SPAC route (where Indian companies, through complex structures, merged with overseas listed entities and thus again Indian assets were listed). However, issuances of this nature have been in decline due to the complexities involved as well as investor appetite.

To provide a boost to Indian companies seeking to access overseas capital, the blueprint for direct overseas listing was laid out in the SEBI Expert Committee Report in December 2018. Subsequently, an amendment to Section 23 of the Companies Act, 2013 (of India) was notified in September 2020 allowing listing of certain class of securities of Indian public companies on permitted stock exchanges in prescribed jurisdictions, which became effective in October 2023.In January 2024, GoI has notified the Companies (Listing of Equity Shares in Permissible Jurisdictions) Rules, 2024 (“MCA Rules”) and simultaneously amended the Foreign Exchange Management (Non-debt Instruments) Rules, 2019 (“NDI Rules”) to enable listing of equity shares of public Indian companies on permitted international exchanges. Currently, the framework permits listing of the equity shares of unlisted public Indian companies on an international exchange. For listed public Indian companies, SEBI will release the operational guidelines in due course. Further, as of now, the international stock exchanges at GIFT-IFSC i.e. India International Exchange and NSE International Exchange (which are under the regulatory supervision of International Financial Services Center, Gujarat Centres Authority) have been stipulated as permitted stock exchanges. In view of the above, International Finance Tec-City shortly Financial Services Centres Authority has invited suggestions for review of the International Financial Services Centres Authority (Issuance and Listing of Securities) Regulations, 2021 from public and regulated entities.

Benefits of Overseas Listing

Some of the other key benefits and reasons for listing overseas include:

  • Diversified Investors: Listing on overseas stock exchanges gives an Indian company access to a larger and more diverse pool of international investors, including those who may not currently invest in Indian markets for various reasons (including such investors who cannot directly invest in Indian securities). Thus, large global funds may be able to invest in these securities in their local market as compared to investing via their India or Asia specific funds which may have certain constraints. This can be crucial for Indian companies to establish a global presence and also gain access to varied investment philosophies and strategies.
  • Improved Valuations: International investors can often offer a more nuanced understanding and valuation of such companies. This aspect is particularly advantageous for emerging high-growth companies, which may not yet be profitable but have significant growth potential. Tech start-ups especially could benefit from this, with more sophisticated markets providing better understanding of their business models and long-term prospects.
  • Brand Visibility: Listing on foreign exchanges enhances brand recognition in developed markets like the United States of America and Europe. Companies such as Infosys, Wipro, ICICI, and HDFC Bank have seen increased global recognition following their overseas listings. Thus, heightened visibility can be a significant asset in establishing a company’s global footprint.
  • Competitiveness and Access to Capital: Overseas listings provide Indian companies access to deeper and more diversified pools of capital. This can result in a lower cost of capital, which is advantageous for expansion and growth of such companies and puts them on level footing with international competitors.
  • Benchmarking and Price Discovery: Listings on overseas stock exchange can also increase analyst coverage for the listed securities and facilitate clearer comparisons against other peer companies that are listed overseas, each of which contribute towards more accurate benchmarking and valuations.
  • Saving Conversion Cost: Direct listing on overseas stock exchanges will result in Indian companies benefiting from foreign currency denominated trades which would enable the investors to save currency conversion costs and hedging.
  • Economic and Diplomatic Tool: Enabling listing of Indian corporates abroad (and vice-versa) will be an important economic and diplomatic tool in the hands of the GoI, which can aid bilateral and multi-lateral ties and help create the comprehensive economic partnerships needed to aid the development of Indian economy.

Direct Overseas Listing - Key Considerations

While initial steps have been taken towards allowing direct overseas listing of Indian companies, there is still some way to go in terms of making this a practical alternative.

The process of direct overseas listing may be complicated by Indian regulations such as Press Note No. 3 (2020 Series) dated April 17, 2020, and Schedule XI of the NDI Rules, of the GoI, which stipulates that investments in Indian companies by residents / entities situated in a country that shares a land border with India require prior Government approval. Other restrictions on foreign investment and sectoral caps on investment into Indian companies could continue to impose artificial limits on how Indian companies can freely access overseas capital markets.

The NDI Rules and the MCA Rules will require amendment for permitting listing on ‘International Exchange’, over and above the international stock exchanges at GIFT-IFSC (which the current regime permits). Further, in relation to the listed public Indian companies, SEBI will release the operational guidelines in due course.

On the taxation front, gains derived on the sale of shares of an Indian company listed on overseas stock exchanges are likely to be treated at par with the gains derived from an Indian unlisted company. However, gains arising on sale of shares of an Indian company listed on an Indian stock exchange are eligible for a beneficial tax levy. While this may not impact non-resident shareholders, resident promoters / shareholders of such Indian company which is listed on overseas stock exchanges will be liable to capital gains tax at the higher rate as compared to the beneficial rate applicable to gains arising on sale of shares listed on Indian stock exchanges. Further, for the purposes of calculation of long-term capital gains tax, the period of holding for shares listed on overseas stock exchanges may be taken as 24 months, as compared to 12 months in case of Indian listed shares. Thus, the government should consider appropriately amending the Income- Tax Act, 1961 to provide the relevant relief to the investors investing in an Indian company listed on overseas stock exchanges. In this regard, reference may also be drawn from the exiting regime for taxation of GDRs.

Additionally, the government should also consider clarifying other ancillary issues such as the applicability of tax fair valuation rules to issuance/transfer of such shares listed on overseas stock exchanges. Without this, overseas listing may not be efficacious.

The process of listing overseas is not only time- consuming but also has costs associated with it in the form of compliances with listing requirements of the chosen jurisdiction, ensuring that the company meets applicable criteria, as well as ongoing financial reporting, tax, know-your client / anti money laundering laws, listing and foreign exchange related fees and expenses. Indian companies will also continue to be subject to local regulations on annual financial reporting and accounting standards which may differ from international standards, resulting in duplicating cost and effort. All of these are commercial considerations for Indian companies when contemplating a direct overseas listing.


Given relatively smaller domestic institutional, non-institutional pools of capital and the inflation, the cost of capital in India is still higher vis-à-vis that for a foreign corporate in a developed economy. This puts Indian companies on the backfoot when it comes to raising growth capital, expanding their business as well as accessing diverse investors who may have better insight into their prospects and valuation.

Thus, a simple and principle based international listing regime, which enables Indian companies to raise capital in the market which optimizes cost and provides the greatest benefits in terms of value, quantum, quality and branding, is the need of the hour.

As a balancing measure and to ensure the quality of Indian corporates seeking an overseas listing, Indian regulators could consider applying threshold criteria to qualify companies for such overseas listing, such as a 3-year performance track record, “fit and proper” standards for promoters/sponsors, parallel financial reporting and ongoing disclosure regimes and other baseline metrics. The thrust of the policy change should be to facilitate access to global capital markets to deserving corporates, boosting Indian companies and the economy as a whole.

With the relevant provisions of the Companies Act, 2013 coming into effect, there is a clear move by regulatory authorities to enable overseas direct listings by Indian companies. While challenges remain, including amendments or clarifications to applicable foreign investment and taxation related regulations, this is a positive step and will provide a fillip to companies in sectors that feel they will be better appreciated in a developed and sophisticated equity market.