The Effect of ADR & GDR Listing on Shareholder’s Wealth: Evidence from India

Abstract

During the period January 2000 to December 2007, seventy nine companies raised capital through the ADR/GDR issues 99 times. This paper looks at the impact of ADR/GDR listing on shareholders wealth. Using an event study methodology and for the sample consisting of 13 ADR and 86 GDR listings the present study finds that ADR/GDR listing negatively effects shareholders wealth. The present study indicates that the potential drawbacks outweigh the benefits in international listing in Indian markets in the short run.