Rising Rupee & Market, Benefit To ADR Holder: An Approach To Risk Return Trade Off

International Diversification of Portfolio, for High Return & Reducing Systematic Risk Creation of Depository Market Listing on NYSE/ NASDAQ/LSE/LxSE

Citi Bank
Depository

IN ABC INDIA LTD

10 ADRs representing one share each. i.e. 10 shares of ABC ltd. @ Rs. 480 each. Invested Rs 4800/ When US $ 1.00 = Rs 48.00 US $ 100 Inflow of Capital

LISTED ON BSE
BSE rises by 25 % ABC Shares has beta coefficient 1.00 appreciated by 25% Current market price, Rs 600/- each share

DR
Investor In US

for ABC (India) Ltd. Capital

10 shares of ABC India ltd sold for Rs 600/- (net tax & brokerage)

Inflow
(US $ 100)

Collected Rs 6000/-

Invested US $ 100 Received US $ 150

Net Saving US $ 50

Rupee appreciate to US $ 1.00 = Rs 40/Conversion of Rs. 6000.00 US $ 150 Return to ADR Holder

Two-way Market Integration: Atop Down & Bottom Up Approach

EXTERNAL MARKET

International Diversification of Portfolio, for High Return & Reducing Systematic Risk

Creation of ADR/GDRS Market

Listing on NYSE/ NASDAQ/LSE/ LxSE

Two-way discovery of price & arbitrage

Growing Economy Stability of Rupee

EMERGING SECTORS I.T Banks Metal Pharmaceuticals Automobile PRIMARY MARKET

Rising Sensex Entry of Capital Inflow Control in Inflation DR High GDP Investor Partial Capital Account Convertibility

SHORT LISTING BLUE CHIPS COMPANIES Infosys UTI Bank Hindalco Ranbaxy Tata Motors
SECONDARY MARKET

BSE/ NSE
EFFICIENT MARKET On Line Trading Dematerialization Foreign Broker Efficient Pricing Custodial Services FIIs presence

Value For Investment

Higher share price
Liquidity Blue chip Increase in FIIs holdings Expansion stage of companies

Using the Fungibility Profit Booking on underlying

Profit & capital out flow

INTERNAL MARKET

Technology
Good Governance

Accounting Disclosure
Global Perspective High EPS and Dividend
Conversion of Dividend amount in US $

Remittance of US $ to Holders
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