Engagement
Listing at GIFT IFSC: Companies Act rules and Form LEAP-1
Last reviewed 07 November 2026
Companies Act work for a direct listing at GIFT IFSC.
In short
An unlisted Indian public company can list its securities directly on an international exchange at GIFT IFSC under the Companies (Listing of equity instruments in permissible jurisdictions) Rules. From November 2026, these rules cover equity shares, convertible debentures and preference shares, and a company with negative net worth may list if at least 75% of the net offer goes to qualified institutional buyers. A private company must first convert to a public company. The prospectus is filed with the Registrar in Form LEAP-1 within seven days of filing it with the exchange.
Overview
Section 23(3) of the Companies Act, 2013 lets a notified class of public companies list notified securities on permitted stock exchanges in permissible foreign jurisdictions. MCA's Companies (Listing of equity shares in permissible jurisdictions) Rules, 2024 (G.S.R. 61(E), 24 January 2024) name GIFT IFSC as the permissible jurisdiction. The permitted exchanges are India International Exchange (IFSC) Ltd and NSE International Exchange (NSE IFSC Ltd).
The foreign exchange side sits in the Direct Listing Scheme, Schedule XI of the Foreign Exchange Management (Non-debt Instruments) Rules, 2019, added by the Ministry of Finance on 24 January 2024 (S.O. 332(E)). Only persons resident outside India may invest under it.
What changed in November 2026
The Companies (Listing of equity instruments in permissible jurisdictions) Amendment Rules, 2026 (G.S.R. 968(E), 3 November 2026) apply from their publication in the Gazette.
| Point | Before | From 3 November 2026 |
|---|---|---|
| Securities covered | Before: Equity shares | From 3 November 2026: Equity instruments: equity shares, convertible debentures and preference shares |
| IFSC companies | Before: Not a separate category | From 3 November 2026: Unlisted public companies in IFSC may list, under the IFSCA Act, 2019 and its regulations |
| Negative net worth | Before: Not eligible | From 3 November 2026: Eligible if at least 75% of the net offer is allotted to qualified institutional buyers |
| Past default to banks or secured creditors | Before: Eligible two years after the default is made good | From 3 November 2026: Eligible more than six months after it is made good |
| Default in filing annual return or financial statements | Before: Not eligible | From 3 November 2026: Not eligible only while the default has not been made good |
| Form LEAP-1 | Before: Prospectus filing form | From 3 November 2026: Replaced; now carries declarations on any pending inspection, inquiry or investigation and a certificate from a practising CA, CMA or CS |
The Direct Listing Scheme under FEMA was written for equity shares. Check whether it has been widened to preference shares and convertible debentures before planning a listing of those.
Who cannot list
Under rule 5, a company is not eligible if it:
- is a section 8 company or a Nidhi;
- is limited by guarantee and also has share capital;
- has outstanding public deposits under Chapter V;
- has negative net worth, unless it meets the 75% qualified institutional buyer condition;
- has defaulted to a bank, public financial institution, debenture holder or secured creditor, unless the default was made good more than six months ago;
- has applied for, or faces, winding up or insolvency resolution;
- has an unremedied default in filing its annual return or financial statements.
A company in a sector where foreign investment is prohibited cannot use the Scheme. Investors from countries sharing a land border with India need prior Government approval. A private company must first convert to a public company.
Steps on the Companies Act side
- 1.Eligibility check. Test the company against rule 5 and clear any pending annual return or financial statement filings.
- 2.Conversion. A private company converts to a public company under section 14 and alters its articles. See company conversion.
- 3.Capital and approvals. Increase authorised capital if needed (Form SH-7), and pass the board and shareholder resolutions for the issue or offer for sale.
- 4.Prospectus filing. File the prospectus with the Registrar in Form LEAP-1 within seven days after it is finalised and filed with the permitted exchange. The form needs a certificate from a practising professional.
- 5.After listing. Prepare financial statements under Ind AS, keep foreign holding within the FEMA sector limits, and continue annual ROC filings. See FEMA and RBI filings.
The offer document, the exchange application and IFSCA matters are handled by the merchant banker and legal counsel appointed for the listing. The practice works alongside them on the Companies Act side.
Key Deliverables
- Rule 5 eligibility review
- Conversion of a private company to a public company
- Capital increase, board and shareholder resolutions, and ROC filings
- Form LEAP-1 and its practising Company Secretary certificate
- FEMA reporting with the company's authorised dealer bank
Documents & E-Forms
- LEAP-1
- INC-27
- SH-7
- MGT-14
When to Engage
Before the merchant banker files with the exchange, so that eligibility, conversion and approvals are in place and Form LEAP-1 can be filed within seven days.
Typical turnaround: Scoped in the engagement letter.
Frequently Asked
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