Govt eases rules to facilitate direct listing of Indian companies at GIFT-IFSC

The easier rules are expected to benefit start-ups and companies in the sunrise and technology sectors.

The government has lowered the public shareholding requirement for Indian companies seeking to list on the recognised stock exchanges at the International Financial Services Centre (IFSC) in Gujarat's GIFT City, aiming to ease access to global capital markets.

The Department of Economic Affairs, Ministry of Finance, amended the Securities Contracts Regulation Rules (SCRR), 1956, reduced the minimum public offer and continuous listing requirement to 10 percent for companies listing on international exchanges at the GIFT IFSC.

This is significantly lower than the 25 percent mandated for listings on domestic exchanges.

This amendment follows the government’s initiative announced in January, allowing domestic public companies to issue and list their shares directly on global exchanges housed at the GIFT IFSC. At present, both major Indian exchanges NSE and BSE operate their international exchanges at GIFT City IFSC, namely NSE IFSC IX, and India INX.

The ‘Direct Listing of Equity Shares of Companies Incorporated in India on International Exchanges Scheme’ is governed under the Foreign Exchange Management (Non-Debt Instruments), 2019, and the Companies (Listing of Equity Shares in Permissible Jurisdictions) Rules, 2024.

This provides a comprehensive regulatory framework for Indian companies aiming to list overseas, said the Department of Economic Affairs, Ministry of Finance, in a press statement.

The new rules stipulate that “for public Indian companies desiring to list solely on international exchanges in IFSCs, the minimum offer and allotment to the public as per the offer document shall be at least 10 percent of the post-issue capital,” said the statement.

Further, “the continuous listing requirement for such companies has also been set at 10%, as outlined under Rules 19 (2)(b) and 19A of the SCRR,” it added.

The easier rules are expected to benefit start-ups and companies in the sunrise and technology sectors by lowering barriers to listing internationally and accessing global capital.

“This will particularly benefit Indian companies going global and having ambitions to look at opportunities for expanding their presence in other markets,” said the ministry in the statement.

The government's amendments demonstrate its commitment to fostering an agile and world-class regulatory environment in IFSCs, thereby bolstering India’s role in the global financial system, it added.