In a bid to attract both Indian and foreign companies to list in the international stock exchanges at GIFT City, Gandhinagar (Gujarat), the finance ministry has reduced the minimum public float requirement to 10 per cent from 25 per cent.
- Also read: international stock exchanges at GIFT City, Gandhinagar
The ministry amended the Securities Contracts (Regulation) Rules on Wednesday to facilitate the reduced norm.
The move is expected to especially enable Indian startups and unicorns to access a larger pool of foreign capital, experts said.
Startups in the technology and other emerging sectors can target direct listing in the bourses at GIFT City, which is the country’s sole international financial services centre (IFSC), they added.
- Also read: Fintech hub at GIFT City to become functional by January 2025
In January, the finance ministry had allowed domestic public companies to issue and list shares directly in global stock exchanges operating in GIFT City.
Currently only foreign investors and non-resident Indians can undertake share transactions on the IFSC exchanges.
On the latest relaxed public float norm, Mayank Arora, Director-Regulatory, Nangia Andersen India, said, “The amendment has been brought about to encourage Indian and foreign companies to list their securities in stock exchanges located in IFSC, mandating lower dilution of ownership.”
It has carved out special provisions for securities listed on recognised stock exchanges, he said.
Companies exploring listing of securities usually consider factors such as liquidity, regulatory environment, cost of listing, and visibility, among others.
