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    An ADR is a negotiable U.S. certificate representing ownership of shares in a non-U.S. corporation. ADRs allow U.S. investors to purchase shares of foreign companies and receive dividends in U.S. dollars while trading on U.S. exchanges. ADRs were created in 1927 to facilitate international investment and provide foreign companies access to U.S. capital markets. Benefits of ADRs include broadening a company's investor base, enhancing its profile internationally, and offering a new avenue to raise equity capital for non-U.S. companies, while providing convenience and opportunities for diversification to U.S. investors.

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    Adr

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    An ADR is a negotiable U.S. certificate representing ownership of shares in a non-U.S. corporation. ADRs allow U.S. investors to purchase shares of foreign companies and receive dividends in U.S. dollars while trading on U.S. exchanges. ADRs were created in 1927 to facilitate international investment and provide foreign companies access to U.S. capital markets. Benefits of ADRs include broadening a company's investor base, enhancing its profile internationally, and offering a new avenue to raise equity capital for non-U.S. companies, while providing convenience and opportunities for diversification to U.S. investors.

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    An ADR is a negotiable U.S. certificate representing ownership of shares in a non-U.S. corporation. ADRs allow U.S. investors to purchase shares of foreign companies and receive dividends in U.S. dollars while trading on U.S. exchanges. ADRs were created in 1927 to facilitate international investment and provide foreign companies access to U.S. capital markets. Benefits of ADRs include broadening a company's investor base, enhancing its profile internationally, and offering a new avenue to raise equity capital for non-U.S. companies, while providing convenience and opportunities for diversification to U.S. investors.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT or read online from Scribd
    Download as ppt
    2K views10 pages

    Adr

    Uploaded by

    vahid
    An ADR is a negotiable U.S. certificate representing ownership of shares in a non-U.S. corporation. ADRs allow U.S. investors to purchase shares of foreign companies and receive dividends in U.S. dollars while trading on U.S. exchanges. ADRs were created in 1927 to facilitate international investment and provide foreign companies access to U.S. capital markets. Benefits of ADRs include broadening a company's investor base, enhancing its profile internationally, and offering a new avenue to raise equity capital for non-U.S. companies, while providing convenience and opportunities for diversification to U.S. investors.

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    of 10

    AMERICAN DEPOSITARY

    RECEIPTS
    What is ADR?

    An ADR is a negotiable U.S. certificate representing ownership of shares in an


    non-U.S. corporation. ADRs are quoted and traded in U.S. dollars in the U.S.
    securities market. Also, the dividends are paid to investor in U.S. dollars.

    ADRs were specifically designed to facilitate the purchase, holding and sale of
    non-U.S. securities by U.S. investor, and to provide a corporate finance vehicle
    for non-U.S. companies.
    Some more points about ADRs...


    ADRs were first introduced in 1927.

    The stock of many non-US companies, trade on US
    exchanges through the use of ADRs.

    ADRs enable US investors to buy shares in foreign
    companies without undertaking cross-border transactions.

    The shares of the non-US corporation trade on a non-US
    exchange, while the ADRs trade on a US exchange.
    ADR Ratio
    ADR Issue
    Benefits of ADRs

    BENEFITS TO BENEFITS TO
    COMPANIES INVESTORS

    Broadening and diversifying a Convenient to purchase and hold


    company’s US investor base a
    non-U.S. issuer's securities.
    Enhancing a company’s
    visibility, Opportunity to invest and earn in
    status and profile in the US and US dollars.
    internationally, among investors.
    Diversifying portfolio.
    Offers a new avenue for raising
    equity capital, often at highly Invest in high-growth economies.
    competitive rates.
    Working of ADR Market
    Participants in ADR Market
    ISSUER DEPOSITARY BROKERS
    Appoint depositary,
    lawyers, investment bank,
    etc.
    Prepare & issue
    Make securities available
    Determine program type. certificates.
    to investors.
    Obtain approval from Announcement of issue.
    Submit required forms.
    Board of Directors,
    shareholders and Coordinate with lawyers,
    Execute & settle trades.
    regulators. accountants & bankers.

    CUSTODIAN INVESTMENT
    BANKERS

    Receive underlying shares.

    Confirm deposit of under- Advise on DR structure.


    lying shares.
    Conduct roadshow.
    Transmit dividend
    payments. Price & launch securities.

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