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SEBI panel to study option of direct overseas listings
Why it is in news?
- The Securities and Exchange Board of India (SEBI) has constituted an expert committee to examine the possibility of allowing unlisted Indian companies to directly list equity overseas while also allowing foreign companies to list directly on the Indian bourses.
- Considering the evolution and internationalisation of the capital markets, it would be worthwhile to consider facilitating companies incorporated in India to directly list their equity share capital abroad and vice versa.
- Currently, Indian firms can only use the depository receipts route — American Depository Receipt (ADR) or Global Depository Receipt (GDR) — to list on overseas exchanges.
- For foreign companies wanting to list on Indian exchanges, the Indian Depository Receipt (IDR) is the only option currently.
- A depositary receipt (DR) is a negotiable financial instrument issued by a bank to represent a foreign company’s publicly traded securities.
Source
The Hindu