NASDAQ explores overseas listings for Indian companies, awaits regulatory clarity

The US stock exchange Nasdaq has engaged in discussions with Indian authorities regarding the potential inclusion of local Indian companies in overseas listings, Reuters reported.

Edward Knight, Nasdaq's Executive Vice Chairman, revealed that talks held in October with Indian Finance Minister Nirmala Sitharaman and SEBI Chairperson Madhabi Puri Buch focused on the possibility of permitting Indian companies to directly list on foreign stock exchanges.

Knight emphasised that this move could provide Indian firms, especially in the technology sector, broader access to global capital.

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"Those companies that have interest in reaching out to global investors, particularly companies in the technology area, those companies should be allowed to do so," Reuters quoted Knight as saying.

Nasdaq sees potential beyond Gujarat International Finance Tec-City (GIFT) and advocates for foreign bourses not being excluded from the policymaking process.

While the GIFT City project, initiated in Gujarat in 2011, aspires to become a significant international financial hub, regulatory uncertainties persist.

Current regulations do not permit Indian companies to directly list shares on GIFT's International Financial Services Centre (IFSC).

In October, India's corporate affairs ministry made legislative amendments that could open the door for Indian businesses to list overseas directly.

However, specific details are yet to be disclosed, and sources suggest that initial approval may be granted for listings on the IFSC, with direct listings on foreign exchanges coming at a later stage.

Nasdaq's Knight expressed optimism, stating, "We are hopeful that when they (rules) are finally promulgated, it will facilitate the listing of companies not only here in GIFT city but also in other jurisdictions."

He also highlighted the potential for facilitating foreign direct investment in India by making it easier for Indian companies to initially list outside the country.

Despite India's robust startup ecosystem, ranking as the world's third-largest, investors, including Tiger Global, Sequoia Capital, and Lightspeed, have advocated for streamlined regulations to enable companies to list overseas.

The move is seen as providing an alternative option for entrepreneurs and venture capitalists, allowing better access to capital.

Nasdaq's future plans include launching an exchange-traded fund (ETF) named QQQ on IFSC, tracking the NASDAQ 100 Index, representing the top 100 Nasdaq companies.

(With inputs from Reuters)

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