Indian Investors Can Now Join US IPOs — But There's a Catch

Indian investors have a shot at participating in US IPOs — including offerings from major AI companies like Anthropic. The mechanism is the Liberalised Remittance Scheme (LRS), which allows Indian residents to send money abroad. But as Ankita Pathak told ETMarkets, retail investors will run into a series of constraints.

What LRS Is and Why It Matters for IPOs

LRS is a channel approved by the Reserve Bank of India for individuals: you can transfer money abroad up to a set annual limit. It's through this route that Indians gain access to overseas investments, including US initial public offerings. On paper, the door is open — but in practice, it's more complicated.

Why Retail Investors Struggle

First, the LRS limit caps how much one person can invest per year — you can't make a big bet on a single IPO. Second, participating in foreign offerings requires brokerage access to the US market, and not all Indian platforms provide it. Third, there are tax nuances: income from overseas investments must be declared in India, and the rules may differ from familiar domestic schemes.

AI Companies Are Postponing Listings

Even if an investor is ready, the issuers aren't rushing. According to Pathak, many prominent AI firms are delaying IPOs due to market volatility. Anthropic is one example: there's interest in listing, but the window may not open immediately. That means investors should be patient and follow news about specific offerings rather than expecting a quick entry.

What This Means in Practice

• Check whether your broker supports access to US IPOs and through which channels.
• Confirm the current LRS limit and how it's used — transfers for investments and other purposes are combined.
• Sort out taxes in advance: foreign income requires reporting in India.
• Keep in mind that listing timelines can shift — especially for AI companies.

For those paying for foreign services and working with crypto, LRS isn't the only tool. Virtual cards and stablecoins are often used for cross-border payments, but each method has its own rules and limits. The key is understanding which channel fits a specific task.

Not financial advice.

Sources

• https://economictimes.indiatimes.com/markets/expert-view/etmarkets-nri-talk-want-to-invest-in-us-ipos-ankita-pathak-on-what-indian-investors-need-to-know/articleshow/134515708.cms