With foreign investors increasingly flocking to the stock of Arvind Ltd on the Indian bourses, the company has decided to delist its global depository receipts from the Luxembourg Stock Exchange.

Termination of pact In a statement on Saturday, the company said it would voluntarily delist its GDRs from the Luxembourg bourse.

“The GDRs listing have been cancelled from the Luxembourg SE w.e.f. October 3, consequent upon termination of deposit agreement with the Depository JP Morgan Chase Bank NA, New York, after its resignation as a depository,” a company statement filed with the BSE said.

“The company has not appointed any successor depository and has terminated the deposit agreement for lack of liquidity with virtually no trading taking place due to investors’ decreasing interest in depositary receipts,” it said.

In 2005, Arvind had issued 13.5 million GDRs and subsequently raised $37.19 million. The GDR was priced at $2.75 (₹120) each against the closing price of ₹126.75 a share on the BSE on July 11.

Non-traded GDRs However, while most of these GDRs have been converted into Indian equities over these years, a small quantum of GDRs remain non-traded on the international exchange.

“There are about three lakh GDRs remaining, while the rest have been converted into Indian shares. So, trading was not happening with such low quantity. Therefore, we decided to cancel the listing,” Jayesh Shah, Director and Chief Financial Officer, Arvind, told BusinessLine .

While the delisting will not have any financial implications for the company, the trend shows increased interest from overseas investors in the company.

“In the past one year, FII investment in Arvind has increased significantly. This is a demonstration of confidence by the foreign investors in the company and its businesses. Most FIIs are investing in Arvind through Indian shares as GDRs are no longer available,” said Shah.

FII holding in Arvind has successively increased from 15.71 per cent in September 2013 to 23.56 per cent as on September 2014. However, domestic institutional investors’ investment has slipped from 19.42 per cent in September 2013 to 14.30 per cent now.

Arvind’s shares had rallied to a 52-week high of ₹341.40 on September 16, from ₹224.5 on August 13. On Monday, it ended 3.90 per cent higher at ₹283.50, on the BSE.