Listing abroad: can Indian startups list overseas or in GIFT City?

An Indian-incorporated company cannot simply list its shares on Nasdaq or the London Stock Exchange the way it lists on the NSE. Indian company law and foreign exchange rules limit direct foreign listings. For years the options were indirect: issue depository receipts, or build a foreign parent company that lists in its own name.

This is why many well-known Indian startups were set up with a holding company in the United States or Singapore. The overseas company, not the Indian one, lists abroad. Moving back to India for a domestic listing is called reverse flipping, and it has become common in recent years.

A depository receipt is a certificate issued abroad that represents shares of a company held in its home country. An American depository receipt (ADR) trades in the United States, a global depository receipt (GDR) in other markets. The Indian company deposits shares with a custodian, and the receipts are sold to foreign investors.

Indian companies have used ADRs and GDRs for decades, mostly large ones. Receipts require the company to meet the foreign exchange rules for issue and to follow the listing rules of the foreign exchange. The route fits established companies better than young startups, which usually have neither the size nor the compliance history.

GIFT City, in Gujarat, is India's International Financial Services Centre (IFSC), a zone with its own regulator, IFSCA, and its own exchanges, India INX and NSE International Exchange. In 2020 the Companies Act was amended with Section 23(3), which lets the government allow Indian public companies to list shares directly in permitted foreign jurisdictions.

In January 2024 the government notified the first set of rules, and the Companies Rules for listing in permissible jurisdictions followed in 2024. The permitted places were the exchanges in GIFT IFSC. In August 2024 the minimum public shareholding for companies listing only in the IFSC was lowered to 10%. Press reports indicate that the Companies Rules were amended again in early November 2026 to cover more kinds of securities, so the current rules should be checked.

• Legal basis: Section 23(3) of the Companies Act 2013, inserted in 2020.
• Foreign exchange: a direct-listing scheme under the FEMA rules, notified in 2024.
• Permitted venues: India INX and NSE International Exchange in GIFT IFSC.
• Regulator for the listing: IFSCA, with the Indian company law applying to the company.
• Status: the legal framework exists, but operational details and actual listings were still emerging as of November 2026.

A domestic IPO sells shares to investors in India on the NSE and BSE, under SEBI's rules, and trades in rupees. A GIFT City listing trades on an exchange inside India's IFSC, in foreign currency, and is meant to draw global investors and funds that prefer to trade in dollars without leaving the country.

The listing does not make the company foreign. It stays an Indian company. The point is access to a pool of international money and a currency match for companies with overseas revenue. The audience of buyers on these exchanges is currently much smaller than in the main Indian markets.

Depth of money is the first reason. Indian mutual funds, insurers and retail investors now provide large and steady demand, and the major domestic exchanges give far more trading volume than the new IFSC exchanges. Several technology companies have listed in India in recent years at large valuations, which has shifted the preference toward home markets.

Familiarity matters too. Investors in India understand local business models, and valuation for loss-making consumer and fintech companies has been tested domestically. Foreign listings also bring extra costs: audits to foreign standards, overseas lawyers and a second set of rules to follow.

Founders look at who will buy and trade their shares after listing, how much it costs, the tax on exit and how easy it is to raise more money afterwards. Investors look at how soon they can sell and in which currency. For a startup with mainly Indian customers, a domestic listing usually offers more buyers.

For a company with customers or revenue abroad, an overseas or IFSC listing may be tempting. It can also suit companies that are already structured with a foreign parent. Rules in this area are changing fast and specific rules apply to each structure. Treat this guide as general education and check with a lawyer or company secretary for any real plan.

A listing abroad or in GIFT City raises questions that a domestic IPO does not. Shareholders may be taxed differently depending on where the shares trade, in which currency, and whether the holder is a resident or a non-resident. Companies must also follow the exchange's own disclosure rules as well as Indian company law.

The government and IFSCA have used tax and rule changes to make the IFSC more attractive, and these have been revised more than once. Because details differ by structure, founders usually take advice from lawyers and tax advisers before choosing a route. The practical lesson for a reader is that a headline about a listing plan abroad is an early step, not a done deal.

Raising money from foreign investors and listing abroad are separate things. Many Indian startups already have foreign funds as shareholders, which is allowed under the foreign direct investment rules in most sectors. These investors hold unlisted shares and can only sell them privately or at a later IPO.

A listing is about trading. It gives every investor, big or small, the ability to buy and sell on an exchange every day. A startup can therefore have a large foreign shareholder base and still list only in India. Reading a story, ask whether it is about who owns the company or where the shares will trade. The answers are often different.

Companies that choose a foreign listing usually have a clear reason, such as most revenue in dollars, a foreign parent or investors who can hold shares only on certain exchanges. For most others, the home market offers the simplest path.

Nothing here is investment, legal or tax advice.