What are ADRs and GDRs?
American Depositary Receipt (ADR): A security issued by a company outside the U.S. which physically remains in the country of issue, usually in the custody of a bank, but is traded on U.S. stock exchanges. ADRs are issued to offer investment routes that avoid the expensive and cumbersome laws that apply sometimes to non-citizens buying shares on local exchanges. The first ADR was issued in 1927. ADRs are listed on the NYSE, AMEX, or NASDAQ. Global Depository Receipt (GDR) : Similar to the ADR described above, except the GDR is usually listed on exchanges outside the U.S., such as Luxembourg or London. Dividends are usually paid in U.S. dollars. The first GDR was issued in 1990. They are shares without voting rights. The ratio of one depository receipt to the number of shares is fixed per scrip but the quoted prices may not have strict correlation with the ratio. Any foreigner may purchase these securities whereas shares in India can be purchased on Indian Stock Exchanges only by NRIs o
