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DR
Listed
Unlisted
AMERICAN DEPOSITORY RECEIPT
(ADR)
LEVEL 2
ADR
LEVEL 3
RULE 144A
SPECIMEN COPY OF ADR
GLOBAL DEPOSITORY RECEIPT(GDR)
DIFFERENCE BETWEEN ADR & GDR
BASIS FOR ADR GDR
COMPARISON
Acronym American Depository Receipt Global Depository Receipt
ADR is a negotiable instrument GDR is a negotiable
Meaning issued by a US bank, instrument issued by the
representing non-US company international depository bank,
stock, trading in the US SE representing foreign companys
stock trading globally
Voting rights on shares issued under the scheme shall be as per the
provisions of companies Act 1956 & in a manner in which restrictions on
voting rights imposed on ADR/GDR issues shall be consistent with the
company law provisions
Erstwhile OCBs who are not eligible to invest in India through the
portfolio route & entities prohibited to buy , sell or deal in securities by
SEBI will not be eligible to subscribe to ADRs/GDRs issued by Indian
companies
The pricing of ADR/GDR issues should be made at a price not less than the
higher of the following two averages:
i. The average of the weekly high & low of the closing prices of the related
shares quoted on the stock exchange during the six months preceding the
relevant date
ii. The average of the weekly high & low of the closing prices of the related
shares quoted on a stock exchange during the two weeks preceding the relevant
date
A limited two - way fungibility schemes has been put in place by the
government of India for ADRs/GDRs
Companies furnish full details of issue in the form enclosed in Annex-8 to the
Reserve Bank within 30 days from the date of closing of the issue.
Also furnish a quarterly return in the form enclosed in Annex-9, to Reserve
Bank within 15 days of the close of the calendar quarter
INDIAN DEPOSITORY RECEIPT(IDR)
IDR is a financial instrument denominated in Indian
rupees in the form of DR created by a domestic
depository against the underlying equity of issuing
company to enable foreign companies to raise funds
from the Indian securities market
US $ billion
ADR/GDR
raising new capital. Now our companies can easily raise capital from
foreign markets through ADRs/GDRs.
Investors around the world are increasingly looking across their national
borders in an effort to geographically diversify their portfolios by
investing in international securities. DR programmes are beneficial to the
investors who wants to diversify their portfolios internationally.