London Stock Exchange (LSE) is in talks with several Indian technology firms for their overseas stock listings, a senior executive for the British exchange told Reuters, as New Delhi moves closer to allowing companies to directly access foreign markets.
India is drawing up rules to allow companies to float overseas without having to first list shares in India as a way to help start-ups reach higher valuations and access capital more easily. With companies such as Reliance's digital unit - which recently raised over $20 billion from investors - considering listing abroad, the relaxed rules present an opportunity for some of the world's leading stocks exchanges to vie for India’s rapidly growing tech and start-up companies.
India has the world's third-largest start-up ecosystem, which is expected to grow by 12-15 per cent annually, the government says. In 2018, India had about 50,000 start-ups, of which around 9,000 were technology-focused, and many have attracted the likes of global investors SoftBank and Sequoia Capital. LSE is “enthusiastic and optimistic” about the prospect and has held talks with Indian companies in recent months, particularly in the tech sector, said Gokul Mani, its head of primary markets for India, Middle East and Africa. “It's several (Indian) companies in the technology sector that we’re talking to. We have a very strong technology sector representation on LSE,” Mani said.
Mani declined to name any specific companies, but LSE said technology is the fourth-largest sector on the exchange, representing around 11 per cent of the total market capitalisation of London-listed firms. SEBI had marked out 10 possible foreign markets for overseas listings, including the US and Britain, back in 2018, but it took until this year for regulation to move forward.