The Hindu Business Line : Cos with Indian accounting norms can list on LSE

Mr Martin Graham (left), Director-Market Services, London Stock Exchange, and Mr Hugh Sandeman, Head, Business Development - India, at a press conference in Mumbai on Friday. — Shashi Ashiwal

Mumbai , Nov. 4

INDIAN companies can now get listed on London Stock Exchange (LSE) by reporting their financial results based on Indian accounting standards.

Until now, these companies had to report their financial data in accordance with the International Financial Reporting Standards (IFRS).

LSE has also allowed overseas companies listed on Luxembourg Exchange to trade on the London Exchange. These relaxations are seen as a move to attract more Indian listing on LSE. This follows the implementation of the European Union Prospectus Directive on July 1, 2005.

"As before, Indian issuers can raise capital from London's professional investors yet adhere to the accounting standards of their choice," said Mr Hugh Sandeman, Head of Business Development for India of LSE, at a press conference here on Friday.

With this new rule, Indian companies can list directly with the UK Listing Authority (UKLA), but can continue to use India's generally accepted accounting principle, instead of conforming to the new European requirement for listed companies to report.

This exception from EU securities regulation will be available to Indian companies and other Third World countries on an indefinite basis for depository receipts, convertible bonds and debt.

Mr Sandeman said by introducing the exemption, LSE and UKLA have ensured continuity for Indian global depository receipts and foreign currency convertible bonds issuers.

At present, 20 Indian companies' GDRs are listed on LSE main market. However, the companies which follow Indian accounting standards will not be able to market and sell their securities to retail investors.

The exchange has started actively promoting its International Order Book platform for GDRs in India, wherein companies' securities listed on Luxembourg Stock Exchange can be traded on LSE.

Mr Martin Graham, Director of Market Services, LSE, said major Indian companies listed on Luxembourg Stock Exchange are actively traded on LSE. Some of the Indian companies traded on International Order Book platform are Ballarpur Industries, Reliance Industries, Grasim Industries, Hindalco, ITC, Larsen & Tourbo and others.

Mr Graham said there are 241 companies from 21 countries on International Order Book. "Last year, total trading value in depository receipts was in excess of $100 billion of which the shares of Indian companies were a healthy five per cent."

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