How the IFSC can be made attractive for SPAC listing
Media articleWhat is permitted now is a one-way traffic. No changes in the tax regime that facilitate tax neutral de-SPACing, prove to be a significant dampener for an overseas direct listing.
Listing a company in an overseas market is a long journey. Whether you want to go global now or later, our teams of experts can empower you and show you the way forward.
Overseas listing presents a perfect platform for mid-sized Indian companies with global ambitions. With access to larger and more diversified pools of capital, at a comparatively low cost, these companies can now become competitive globally and attract higher valuations.
Some of these global markets are highly sophisticated, for example, tech startups, listing on the US stock exchanges have a deeper technology investor ecosystem that understands the risks involved in startups and technology firms better.
In May 2020, under the Aatmanirbhar Bharat Abhiyan, the Government of India announced definitive measures to help Indian companies raise funds, including the direct listing in overseas markets. Once necessary changes are made to the current regulatory framework, the overseas listing is expected to enhance the competitiveness of the Indian companies in terms of access to diversified and cost-efficient pools of capital, a bigger investor base and better valuations. Key benefits of listings overseas are:
- Broader investor base: Listing overseas enables access to a larger pool of international investors, allowing companies to diversify their investor base.
- Improved valuations: Indian companies gain access to specialized investor classes who are able to better value securities, thus improving valuations. This is especially for emerging high-growth companies in technology that may not be profitable.
- Brand visibility: Overseas listing enhances brand awareness in various developed markets such as US and Europe. The overall brand recognition for companies like Infosys, Wipro, ICICI, HDFC Bank, etc., at the global stage is visible.
Grant Thornton’s team of experts in IPOs, listings and private placements work closely with clients during all stages of this journey.
Webinar Recording
Conversation #1: The Big Opportunity for Indian Companies
Broader investor base, lower cost of capital, improved valuations, and brand visibility are key drivers for high-growth Indian companies seeking to list overseas. However, there is a need for a strong corporate governance framework, robust internal controls, and compliances for businesses to attract global investors in the overseas markets.
Webinar Recording
Conversation #2: Insights for Corporates
Companies with global aspirations and well-defined strategies for growth should consider listing overseas. Healthcare, pharma, cleantech and biotech companies will be among the early drivers of overseas listing. Advisors provide the right direction in terms of roadshows, due diligence checks and regulatory compliances.
Webinar Recording
Conversation #3: Rise of SPACs
Insights on the latest emerging trends in the SPAC space and how to successfully leverage this route to go public.
Over 100 Indian companies will go for an overseas listing in the next decade. From an entrepreneur’s perspective, this is an opportunity to think global. The ability to go to your customers with the profile of being a company listed on a market that they understand and trust, is huge.
Vishesh C. Chandiok
Chief Executive Officer
Overseas listing is an excellent option for Indian companies to do a capital raise. Its key benefits include broader investor base, improved valuations and brand visibility. However, businesses need to carefully evaluate, plan and craft out their strategy to ensure they are able to make the most of listing overseas.
Raja Lahiri
Partner
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Special purpose acquisition companies (SPACs)
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All you need to know about SPACs
While the government has indicated its intent to allow Indian companies to directly list overseas, the increased market acceptance and investor interest in SPAC IPOs provide an exciting opportunity for Indian businesses to access global markets.