Foreign Currency Convertible Bonds (FCCBS)

Companies Act, 2013 (Act) to the issue of Foreign Currency Convertible Bonds (FCCBS) and Foreign Currency Bonds (FCBs) by Indian companies exclusively to persons resident outside India in accordance with applicable sectoral regulatory provisions.
The issue of FCCBS and FCBS by companies is regulated by the Ministry of Finance's regulations contained in Issue of Foreign Currencu Conuertible Bonds and Ordinarv Shares (Through Depository Receipts Mechanism) Scheme, 1993 (Scheme) and Reserve Bank of India through its var:ious directions/regulations.

American depositary receipt
An American depositary receipt (ADR) is a negotiable certificate issued by a U.S. depository bank representing a specified number of shares—or as little as one share—investment in a foreign company's stock. The ADR trades on markets in the U.S. as any stock would trade.

KEY TAKEAWAYS

1. An American depositary receipt (ADR) is a certificate issued by a U.S. bank that represents shares in foreign stock.
2. ADRs trade on American stock exchanges.
3. ADRs and their dividends are priced in U.S. dollars.
4. ADRs represent an easy, liquid way for U.S. investors to own foreign stocks.

Global Depositary Receipt (GDR)

A Global Depositary Receipt (GDR) is a negotiable instrument issued by a depositary bank in international markets — typically in Europe and generally made available to institutional investors both outside and within the U.S. — that evidences ownership of shares in a non-U.S. company, enabling the company (issuer) to access investors in capital markets outside its home country.

ADVANTAGES OF GDR

GDR provides access to foreign capital markets.
A company can get itself registered on an overseas stock exchange or over the counter and its shares can be traded in more than one currency.
GDR expands the global presence of the company which helps in getting international attention and coverage.
GDR are liquid in nature as they are based on demand and supply which can be regulated.
The valuation of shares in the domestic market increase, on listing in the international market.
With GDR, the non-residents can invest in shares of the foreign company.
GDR can be freely transferred.

To know more, Please click here