This company paid Rs 1328 crore tax to move its headquarters to India from US, it works in...

Groww which is an Indian stock trading and mutual fund startup, recently paid USD 159.4 million (Rs 1328 crore) in taxes as part of relocating its headquarters from the U.S. back to India, according to a company statement on Monday. This move is part of a trend, with nearly a dozen Indian startups shifting their domicile from places like the U.S. and Singapore back to India. These companies aim to better comply with local regulations and prepare for potential IPOs in the Indian market.

Relocating a company’s headquarters often triggers a tax event, which affects both the startup itself and its investors. Despite this, the move is becoming more popular due to the current climate for public offerings. While the IPO market has been relatively quiet in the U.S. and other developed countries, India has seen a surge in IPOs. In the first nine months of 2024, almost 70 companies went public, marking the second-highest number of IPOs recorded in any calendar year in India.

One of the main attractions for startups returning to India is the possibility of better analyst coverage, which is important for drawing the interest of institutional investors. This advantage is especially valuable for companies with valuations below USD 2 billion. In the past decade, many Indian startups, including those supported by accelerator Y Combinator, opted to set up their headquarters abroad, but now, a shift back to India is underway.

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