FUNGIBILITY

The IDRs shall be fungible into underlying equity shares of the issuing company in the manner specified by SEBI and RBI from time to time. Partial fungibility of IDRs (i.e. redemption/conversion of IDRs into underlying equity shares) in a financial year to the extent of 25 % of the IDRs originally issued is allowed. All the IDRs shall have partial two-way fungibility.

The partial two-way fungibility means that the IDRs can be converted into underlying equity shares and the underlying equity shares can be converted into IDRs within the available headroom. The headroom for this purpose shall be the number of IDRs originally issued minus the number of IDRs outstanding which is further adjusted for IDRs redeemed into underlying equity shares. SEBI has issued broad guidelines for fungibility of future IDR issuances and the existing listed IDRs.