INSUBCONTINENT EXCLUSIVE:
to list overseas as it seeks to bolster its own capital markets, government officials and industry sources said, in a blow to foreign funds
and stock exchanges seeking to tap into the country's tech boom.The decision marks a sudden reversal in policy after officials said late
last year that the new rules for overseas listings would be announced in February.Three senior government officials with direct knowledge of
the decision told Reuters the plan had been put on hold as India believes there is enough depth in local capital markets for firms to raise
funds and get good valuations
They declined to be named as the move has not been made public.Finance ministry did not respond to a request for comment.Indian equity
markets have boomed as enthusiastic retail investors and a pandemic-induced flood of easy money pushed prices to record highs, encouraging a
slew of Indian tech founders to go local with their initial public offerings (IPOs).More than 60 companies made their market debut in India
in 2021 and raised a total of more than $13.7 billion, which was more than the previous three years combined
Like other global markets, Indian stocks have been rattled by Russia's invasion of Ukraine, and the volatility has delayed IPO plans.But the
outlook for such listings dimmed after digital payments app Paytm, backed by China's Alibaba and Ant and Japan's Softbank, plunged on its
debut in November, raising questions about valuations
Capital had lobbied Prime Minister Narendra Modi to allow Indian firms to list abroad to achieve better valuations, Reuters has reported.A
second government official said the overseas listing rules were now in "limbo" and both the officials cited the stock market debut of
food-delivery giant Zomato, which clocked a high valuation, as contributing to the change of view.When Zomato went public on Mumbai's
exchange in July, its offer was 38 times oversubscribed and its stock jumped 66 per cent
up much of those gains in recent months.Two industry sources briefed by government officials also said they had been told the plan was on
hold, which also marks a setback for exchanges in New York and London, which had been vying for a slice of India's rapidly growing start-up
economy.LOBBYINGGlobal investors have pushed for India to allow overseas listings, saying foreign markets would give Indian companies better
access to liquidity and capital
But such a move, which has been under consideration since at least 2020, has deeply divided policy makers.Nationalist group Swadeshi Jagran
Manch, the economic wing of the ideological parent of Narendra Modi's ruling Bhartiya Janata Party (BJP), opposed the plan, saying such
listings would mean less Indian oversight of domestic firms, while Indian investors would find it more difficult to trade in shares of
companies listing abroad.Despite intense lobbying against the change, Revenue Secretary said in August last year that overseas listing rules
could be announced by February.A source with direct knowledge told Reuters on Wednesday that representatives of Swadeshi Jagran Manch
lobbied Finance Minister in a closed-door meeting in January to not proceed with the policy announcement.Though the group is widely seen as
having strong influence on India's policy making, it is not clear if that particular meeting contributed to the government's decision.One
senior industry executive who has lobbied New Delhi to allow foreign listings said its decision could result in pressure for other changes
by Indian companies."Some (investor) funds may want Indian companies to register outside the country," the executive said, adding that such
a move could allow them to list overseas more easily.
