WHAT IS ADR

Introduced to the financial markets in 1927, an American Depository Receipt (ADR) is a stock that trades in the United States but represents a specified number of shares in a foreign corporation. ADRs are bought and sold on American markets just like regular stocks, and are issued/sponsored in the U.S. by a bank or brokerage. ADRs were introduced as a result of the complexities involved in buying shares in foreign countries and the difficulties associated with trading at different prices and currency values. For this reason, U.S. banks simply purchase a bulk lot of shares from the company, bundle the shares into groups, and reissues them on either the New York Stock Exchange (NYSE), American Stock Exchange (AMEX) or the NASDAQ. In return, the foreign company must provide detailed financial information to the sponsor bank. The depositary bank sets the ratio of U.S. ADRs per home-country share. This ratio can be anything less than or greater than 1. This is done because the banks wish to price an ADR high enough to show substantial value, yet low enough to make it affordable for individual investors. Most investors try to avoid investing in penny stocks , and many would shy away from a company trading for 50 Russian roubles per share, which equates to US$1.50 per share. As a result, the majority of ADRs range between $10 and $100 per share. If, in the home country, the shares were worth considerably less, then each ADR would represent several real shares. There are three different types of ADR issues:
Level 1 - This is the most basic type of ADR where foreign companies either don't qualify or don't wish to have their ADR listed on an exchange. Level 1 ADRs are found on the over the counter market and are an easy and inexpensive way to gauge interest for its securities in North America. Level 1 ADRs also have the loosest requirements from the Securities and Exchange Commission.
Level 2 - This type of ADR is listed on an exchange or quoted on Nasdaq. Level 2 ADRs have slightly more requirements from the SEC, but they also get higher visibility trading volume.
Level 3 - The most prestigious of the three, this is when an issuer floats a public offerings of ADRs on a U.S. exchange. Level 3 ADRs are able to raise capital and gain substantial visibility in the U.S. financial markets. The advantages of ADRs are twofold. For individuals, ADRs are an easy and cost-effective way to buy shares in a foreign company. They save money by reducing administration costs and avoiding foreign taxes on each transaction. Foreign entities like ADRs because they get more U.S. exposure, allowing them to tap into the wealthy North American equities markets.
SOME INDIAN ADRs

ARVIND MILLS LTD. 144A
ASHOK LEYLAND LTD. 144A
BAJAJ AUTO LIMITED 144A
BSES LIMITED 144A GDR
CENTURY TEXTILES AND INDUTRIES LTD. GDR
CESC LIMITED 144A
CORE HEALTH CARE PRODUCTS GDR
CROMPTON GREAVES LIMITED 144A GDR
DCW LIMITED
DR. REDDY'S LABORATORIES LTD 144A
EID PARRY (INDIA) LIMITED 144A
EIH LIMITED 144A
FINOLEX CABLES LIMITED GDR
GRASIM INDUSTRIES LIMITED
GREAT EASTERN SHIPPING CO. LTD. 144A
GUJARAT NARMADA VALLEY 144A
HIMACHAL FUTURISTIC 144A
HINDALCO INDUSTRIES LTD. 144A
HINDALCO INDUSTRIES LTD. WARRANT
INDIA CEMENTS LIMITED 144A, THE
INDIAN ALUMINIUM CO. LTD. 144A
INDIAN HOTEL CO. LTD.
INDIAN PETROCHEMICALS CORP. LTD. 144A
INDIAN PETROCHEMICALS CORP. LTD. 144A
INDIAN RAYON & INDUSTRIES LTD. 144A
INDO GULF FERTILIZERS AND CHEMICAL CO.
INDO RAMA SYNTHETICS (INDIA) LTD 144A
INDUSTRIAL CREDIT & INVESTMENT CORP
JCT LIMITED 144A
JK CORP LIMITED 144A GDR
KESORAM INDUSTRIES CO., LTD.
LARSEN & TOUBRO LIMITED 144A
LARSEN & TOUBRO LIMITED GDR
MAHANAGAR TELEPHONE NIGAM LTD. 144A
MAHINDRA & MAHINDRA LTD.144A
NEPC-MICON LIMITED 144A
RANBAXY LABORATORIES 144A
RAYMOND WOOLLEN MILLS LTD. 144A, THE
RELIANCE INDUSTRIES LIMITED 144A
SANGHI POLYESTERS LIMITED 144A GDR
SIEL LIMITED
SIV INDUSTRIES LIMITED 144A GDRS
SOUTHERN PETROCHEMICAL INDUSTRIES 144A
STATE BANK OF INDIA 144A
STEEL AUTHORITY OF INDIA LIMITED GDR
TATA ELECTRIC COMPANIES
TATA ENGINEERING AND LOCOMOTIVE CO. LTD.
TUBE INVESTMENTS OF INDIA LTD. 144A
USHA BELTON LTD.
VIDEOCON INTERNATIONAL 144A
VIDESH SANCHAR NIGAM LTD (VSNL) 144A