As negotiations for the EU-India trade agreement progress, a growing number of European multinational corporations are considering listing their Indian subsidiaries on the Mumbai stock exchanges. This shift is motivated by a thriving domestic fundraising market, where multinational companies have achieved high valuations in recent years, and a deeper confidence in India's regulatory architecture, disclosure standards, and institutional investor base.

Investment bankers report an increase in inquiries for initial public offerings (IPOs) from European industrial companies, particularly in the auto components, specialty chemicals, and clean energy sectors, especially after the trade deal. According to bankers, German auto components firm MAHLE GmbH and Swedish gaming company Modern Times Group, through its Indian mobile gaming subsidiary PlaySimple are preparing to file draft red herring prospectuses (DRHPs) with the market regulator for proposed IPOs soon. Danish brewer Carlsberg is also contemplating an IPO.

This week, Italian giant Bonfiglioli Transmissions filed a DRHP for a ₹2,000 crore IPO. Last year, German Green Steel & Power received SEBI nod to go ahead with the IPO and will be launching its IPO soon. In November 2025, SAEL Industries, an Indian renewable energy firm backed by Norwegian state-run fund Norfund, filed papers for an ₹4,575 crore IPO.

Bhavesh Shah, managing director and head of Investment Banking at Equirus Capital, notes that the rising interest from European firms indicates a stronger level of confidence in India's regulatory environment and investor base and that the growing base of domestic institutional investors is triggering this trend. If the IPO market maintains its momentum, India could become a preferred regional hub for multinational listings. Several mandates are believed to be in the pre-filing stage, with listings anticipated over the next 12 to 18 months, spanning sectors from precision engineering and renewable energy equipment to consumer-facing brands.

Neha Agarwal, MD and head of Equity Capital Markets at JM Financial Institutional Securities, suggests that the potential conclusion of the India-EU Free Trade Agreement has transformed India's capital markets into a strategic expansion route for European multinationals, especially European automakers. Following successful listings like Orkla India and Carraro India, there's a structural shift where European parents view India not just as a manufacturing hub but as a key market for capital raising.

The India-EU FTA is expected to significantly benefit sectors like textiles and pharmaceuticals through tariff reductions, though challenges may arise for capital goods and the alcoholic beverage industries. The agreement's effects are projected to be felt gradually, with full operationalization expected in 2027.

For the automobile sector, India plans to reduce import duties on fully built EU cars from 110% to 10%, with the first phase starting in 2026, reducing tariffs to 40%. This has led European automakers to view the tariff reduction as a "new opportunity" amidst stagnation in traditional core markets. Renault is reportedly accelerating its India strategy, launching new models and targeting an annual output of 480,000 units by 2030. The Volkswagen Group, encompassing Audi, Porsche, and Škoda, has also labeled India as a market of "strategic importance" and is evaluating the deal's business impact.