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☆ How can foreign investors cash in on India’s growth? Here are the ETFs and stocks to buy
▼ + stars: | 2024-03-07 | by ( Ganesh Rao | ) www.cnbc.com time to read: +4 min

India's economic prospects are shining bright, attracting global investors eager to capitalize on the country's immense growth potential. The International Monetary Fund expects India's real gross domestic product (GDP) to expand by 6.5% in 2024. However, tapping into these opportunities as a foreign investor is not as straightforward as buying shares listed on the Indian stock exchanges. This allows investors outside India to buy shares more easily. ADRs are a way for investors to own shares in a foreign company, with the shares themselves held by a U.S. bank.

Persons: Malcolm Dorson, Alex Watts, GDRs, Dorson Organizations: Monetary Fund, India Active, Franklin FTSE, Interactive, London Stock Exchange, Major, Nokia, Airtel Locations: India, Franklin FTSE India, U.S, Canada, Germany, France, Finnish, China, Europe

Moscow's actions have deprived many foreign investors of the ability to trade in Russian securities, including depositary receipts. Investors are worried about future copycat actions by other governments who might look to reduce foreign influence over their leading companies. Depositary receipts, or DRs, are certificates issued by a bank representing shares in a foreign company traded on a local stock exchange. But events in Russia have forced many investors to write down the value of depositary receipts of Russian companies to zero, given their inability to trade them. CONSEQUENCESLoss of confidence in DRs could drain needed foreign capital from firms in emerging economies, for instance.

Persons: Dado Ruvic, Peter C, Earle, Christopher Day, Michael Ashley Schulman, Goldman Sachs, III, Detsky Mir, Goldman, Otkrytie, Schulman, Grzegorz Drozdz, Malcolm Dorson, Sinead Cruise, Carolina Mandl, David Gregorio Our Organizations: REUTERS, Global, American Institute for Economic Research, Reuters, Citigroup, Companies, Citi ., Reuters Graphics, DR, Investors, Doliver Advisors, Running, Capital Advisors, Conotoxia, Russian, Thomson Locations: Moscow, Ukraine, Brazil, China, Russia, GDR, GDRs, United States, Britain, London, Carolina, New York

The London Stock Exchange Group (LSEG) (LSEG.L) and UK trade officials visited several cities in China to promote UK capital markets recently. Wilson Xu, a banking veteran from CITIC Securities pioneering the Stock Connect programme, said liquidity will improve when there is a critical mass of Chinese listings. The Shanghai-London Stock Connect was launched in 2019 and the link was expanded last year to include Shenzhen and Switzerland. Even arrangements by SIX to allow roughly 2.5 hours of trading in a session for Chinese GDRs didn't help. Chinese companies, however, have been positive in public disclosures about their forays in Europe which have given them an alternative channel to raise funds and access foreign currency for their operations abroad.

The London Stock Exchange and British officials are ramping up efforts to build a robust pipeline of Chinese firms, trading on London's status as Europe's deepest capital market. Edwards said he thought London was "an obvious choice" for many Chinese companies "given the issues around the U.S.-China relationship." However, the China-Switzerland Connect - an eight-month-old rival scheme - is gaining more traction among Chinese companies, partly due to a relatively easier process. The London Stock Exchange is "actively looking at how they can address some of the issues," Edwards said. Edwards said officials have identified hundreds of Chinese companies that could potentially issue GDRs in London and "are actively approaching them at the moment."

Concerns that Chinese investors are buying overseas to make a quick profit at home are valid. Since last year, 11 Chinese companies have raised a combined $3.6 billion by selling GDRs on the Six Swiss Exchange, data from Dealogic show. Savvy punters with access to foreign funds can therefore make a quick and relatively risk-free profit by shorting the Chinese stock and buying the discounted GDRs. This helps explain why Swiss shares of Chinese companies barely trade. Since the launch of a China-Swiss stock scheme in 2022, 11 Chinese companies have raised a combined $3.6 billion, according to data from Dealogic.

☆ China battery giant CATL's $5 billion Swiss listing delayed amid Beijing regulatory concerns, sources say
▼ + stars: | 2023-03-15 | by ( ) www.cnbc.com time to read: +4 min

But the process is taking longer than expected, all three sources told Reuters. In early February, sources said CATL aimed to go ahead with the listing as early as May. Private placementThe sources said the Chinese regulator has concerns over the vast scale of CATL's GDR offering. At $5 billion, the GDR deal would easily be the largest such listing by a Chinese company in Switzerland, according to Refinitiv data. Chinese companies began listing in Switzerland last year after the launch of cross-listing platform to allow companies to raise capital by issuing and listing GDRs on the Swiss exchange SIX.

In early February, sources said CATL aimed to go ahead with the listing as early as May. PRIVATE PLACEMENTThe sources said the Chinese regulator has concerns over the vast scale of CATL's GDR offering. At $5 billion, the GDR deal would easily be the largest such listing by a Chinese company in Switzerland, according to Refinitiv data. With much better liquidity on the domestic market, investors can exit more easily. Such practices have also made Chinese regulators less keen to wave through mega-GDR offerings, two of the sources with knowledge of the matter said.

HONG KONG, March 9 (Reuters Breakingviews) - European financial centres are rolling out the red carpet for Chinese companies. Its free-float market capitalisation of $1.9 trillion is just a tenth of the New York Stock Exchange, January data from the World Federation of Exchanges show. Yet as tensions between Washington and Beijing rise and Chinese companies in New York face the threat of delisting, traditionally neutral Zurich has become an attractive alternative. That removes the risk that overseas regulators will demand access to mainland companies’ books - the source of a lengthy spat between the U.S. Public Company Accounting Oversight Board and Beijing. Deutsche Börse (DB1Gn.DE), which operates Frankfurt’s stock exchange, is technically ready to launch the China-Germany Stock Connect, board representative Niels Tomm said in November.

☆ China's Sany Heavy Industry moves closer to Frankfurt listing
▼ + stars: | 2023-02-11 | by ( ) www.reuters.com time to read: +2 min

SHANGHAI, Feb 11 (Reuters) - Sany Heavy Industry Co (600031.SS), China's biggest maker of engineering machinery, published a set of revised internal rules on Saturday in preparation for a Frankfurt listing - potentially the first there under a mechanism for cross-border listings and investment. Sany is the first China-listed company to pick Frankfurt under the scheme. The company also published confidentiality and archive administration rules to meet China's national security requirements on offshore listings. Sany has not disclosed fundraising targets, or when a Frankfurt listing will happen, only saying in late December that it planned to sell GDRs equivalent to 5% of its share base to fund international expansion. The company, which scrapped an earlier plan for a Swiss listing, has said it is attracted to Frankfurt because Germany's world-class manufacturing capability is a match to Sany's ambition in intelligent manufacturing.

☆ UK-based IT firm Noventiq to list in U.S. through SPAC deal
▼ + stars: | 2023-02-09 | by ( ) www.reuters.com time to read: +1 min

Feb 9 (Reuters) - London-listed IT company Noventiq (SFTLq.L) said on Thursday it will combine with California-based blank-check firm Corner Growth Acquisition Corp for a Nasdaq listing. Noventiq said the current price of its listed global depository receipts (GDRs) was not a fair reflection of the value of the group and there continued to be very limited trading volume of its GDRs on the London Stock Exchange. Special purpose acquisition companies, or SPACs, are listed but have no business operations, except hunting for a private company to take public and allowing it to bypass the scrutiny that comes with a traditional IPO. Noventiq, which provides digital solutions, hardware and cloud services, said the parties expected to finalise the agreement in the coming weeks. Reporting by Aby Jose Koilparambil in Bengaluru; Editing by Rashmi Aich and Shounak DasguptaOur Standards: The Thomson Reuters Trust Principles.

More than a dozen Chinese companies have unveiled plans to follow suit, according to exchange filings. The China-Switzerland Connect allows Chinese companies to raise capital by issuing and listing GDRs on Swiss bourse SIX. Swiss firms can issue Chinese Depository Receipts on the Chinese exchanges. She said UBS is also discussing with Chinese firms about listing in Frankfurt once rules are in place, so "our GDR mandates will keep coming". Despite the brighter prospects, deal sizes have been comparatively small, with Gotion's $685 million Swiss listing the biggest so far under the Swiss connect scheme.

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