Foreign Firms Use India IPOs to Repatriate Billions Amid Market Boom

Foreign companies are leveraging India’s strong initial public offering (IPO) market to sell stakes in their local subsidiaries and transfer proceeds back to their global parent entities, rather than raising new capital for business growth in the country.

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Data from Prime Database shows that six foreign-based companies have listed their Indian units since 2024. Only one of these IPOs had a fresh issue component; the rest were all offers for sale (OFS), where existing shareholders sell shares, and no new money flows into the business.

The trend has resulted in nearly $5 billion being repatriated by foreign parent companies. South Korean firms Hyundai Motor and LG Electronics accounted for more than 80% of the total proceeds generated through these secondary-share sales.

More Foreign Listings Following OFS Route

The pattern is expected to continue as several foreign-owned businesses prepare for public listings in India.
The proposed $1 billion IPO of Walmart-owned PhonePe and the planned $335 million listing of gaming company Modern Times Group’s Indian unit are both expected to be structured entirely as OFS transactions. Earlier this week, Coca-Cola said its planned listing of its Indian bottling business would involve the sale of part of its stake. As per reports, Carlsberg is also considering an Indian IPO without a fresh fundraise component.

An OFS allows existing shareholders to reduce their holdings and realise gains while the company itself receives no new capital from the public issue.

Rupee Faces Additional Pressure

The increase in IPO-linked outflows comes as the Indian rupee remains under pressure against the U.S. dollar.
The rupee has weakened 13% against the dollar since 2024 and has declined 6% so far this year. According to MUFG Bank, strong IPO activity has been one factor contributing to the currency’s weakness.

Foreign portfolio investors have sold more than $23 billion worth of Indian equities in 2026, exceeding the previous annual record outflow of $18.9 billion recorded in 2025.

Axis Bank's business and economics research team noted that IPO-related capital repatriation is creating a steady depreciation bias for the rupee, even if the impact is not abrupt.

Valuation Gap Driving Listings

India remained the world’s second-largest IPO market in 2025 after the U.S., with 367 listings raising $21.8 billion, according to LSEG data. Regulatory filings show that IPO worth about $26 billion are currently awaiting approvals.

One of the main attractions for foreign companies is the valuation premium available in Indian markets. Several listed Indian subsidiaries trade at significantly higher valuation multiples than their overseas parent companies.
Nestle India trades at nearly 77 times earnings compared with about 22 times for its Swiss parent, Nestle. LG Electronics India trades at nearly 59 times earnings, higher than the 44-times multiple of its South Korean parent.

The valuation advantage has encouraged global firms to pursue Indian listings as a way to unlock value from long-held investments. While the structure provides liquidity to existing shareholders, it has also renewed debate over whether public offerings are increasingly serving as exit opportunities rather than channels for raising long-term growth capital.