Top MNCs will be tempted to explore a listing of their operations in the Indian market, which has matured and evolved and is now equipped with strong domestic financing capability, according to Udhay Furtado, Co-Head, Asia ECM (Equity Capital Markets), Citi.
"I do think we will see more in the local market – the size of the local liquidity, there is a catchment to that and there should be an appeal to big global brands being listed here, and big global businesses that face Indian consumers to be listed here. As we see the global supply chain in certain segments of the market move into India, you should be able to finance that in the bond and equity market. I think we see that as part of the natural evolution of the market. We should see more,” Furtado told Moneycontrol in an exclusive interview during his India visit.
“This is one of the most attractive markets on a relative value basis, so corporates will be looking on how to access the capital,” he added.
According to recent media reports, South Korean automaker Hyundai is considering a mega listing of its local arm in India, in a potential IPO which could raise between $3 billion - $5 billion, the biggest yet on domestic bourses.
Reacting to the reports, Hyundai said that as a global company, it is constantly reviewing various activities, including listing overseas subsidiaries, to increase corporate value, but nothing has been confirmed to date.
In his interaction with Moneycontrol, Furtado, an alumnus of the University of Oxford, elaborated further on the tilt in listing strategies of overseas firms and the growth of the Indian market.
"As the market matures and evolves here, there is going to be a great domestic financing capability, which again, is how we think of MNCs in the US, Europe, or Japan. They have been doing this globally for years and years so why wouldn’t they do that in India? Also, 20 years ago, we would have been pitching for Indian companies to list in the US. But why would we need to do that if the market here has evolved and matured to this extent? And that’s part of the evolution of this market," he added.
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