In 2022, the Ministry of Finance published updated Overseas Investment regulations. Under these regulations, it was clarified that any shares acquired or received under Employee Benefits Schemes (includes ESOPs/RSUs) are considered as Overseas Portfolio Investments as long as these shares are less than 10% of the total equity of the company (which they are 99% of the time). 

Further, as per the RBI’s Liberalized Remittance Scheme regulations, Overseas Portfolio Investments can be re-invested in any other publicly-listed companies within a period of 180 days from its sale. 

In conclusion - An Indian resident with overseas ESOPs/RSUs in publicly listed companies can re-invest the funds from its sale in other listed stocks as long as they are reinvested within 180 days of the sale.