Mumbai, April 10 --





It was past 10:30 at night in India when HDFC Bank announced that its part-time chairman Atanu Chakrabarty had quit, triggering a scramble in New York where traders dumped its American Depositary Receipts (ADRs). For the first time in nearly four years, HDFC Bank ADRs traded at a discount to its shares in India. When Dalal Street opened the next day, HDFC Bank fell by more than 5%, and extended losses to more than 7.5% over two sessions.

As regulations eased, domestic liquidity deepened, and Indian markets integrated with global peers, the premium enjoyed by ADRs over Indian stocks has shrunk over the years, and often turned into a discount. The trend signals that the excitement for these instruments has faded, ...