The festive season is here, and the Indian stock market is buzzing! But this year, there’s an extra reason for auto enthusiasts to celebrate. One of the most anticipated IPOs of 2024, Hyundai Motor India, is all set to hit the market on October 15th. This offering will be a landmark event for several reasons.
First, it will be India’s biggest-ever IPO, surpassing the record set by LIC in 2022. Second, it will mark the return of a car manufacturer to the public market after a two-decade hiatus (remember Maruti Suzuki in 2003?). So, before you decide to jump in, let’s take a closer look at what Hyundai Motor India’s IPO offers.
Hyundai Motors India Limited
Offer Price | ₹1865 to ₹1960 per share |
Face Value | ₹10 per share |
Opening Date | 15 October 2024 |
Closing Date | 17 October 2024 |
Total Issue Size (in Shares) | 142,194,700 |
Total Issue Size (in ₹) | ₹27,870.16 Cr |
Issue Type | Book Built Issue IPO |
Lot Size | 7 Shares |
Listing at | BSE, NSE |
This IPO is entirely an offer for sale by the South Korean auto giant Hyundai Motor Company. They aim to offload up to 14.22 crore equity shares, potentially raising a staggering ₹27,870.16 crore. Here’s the breakdown of how the shares will be allocated:
Qualified Institutional Buyers (QIBs) | Up to 50% |
Non-Institutional Investors (NII) | Not less than 15% |
Retail Investors | Not less than 35% |
Employee Reservation | Up to 778,400 shares with a discount of ₹186 per share |
The IPO price band is between ₹1,865 and ₹1,960 per share. Interestingly, the Indian subsidiary of Hyundai won’t receive any proceeds from this offering – the entire amount goes to the South Korean parent company. Mark your calendars! The anchor book for the issue opens on October 15th, with a tentative listing on both BSE and NSE expected for October 22nd.
Objectives of Hyundai Motors India Limited IPO
While the Indian entity doesn’t receive any direct financial benefit, the listing has several strategic advantages:
- Enhanced Brand Image: The IPO aims to boost Hyundai Motor India’s visibility and brand recognition within the domestic market.
- Market Standing: Listing on a major stock exchange like the NSE strengthens Hyundai’s position as a key player in India’s booming automotive sector.
- Long-Term Benefits: This move might pave the way for future growth and potential funding opportunities for Hyundai Motor India.
GMP of Hyundai Motors India Limited IPO
The current Grey Market Premium (GMP) for Hyundai Motor India sits at ₹147.
This suggests that investors in the unofficial market anticipate a listing price of around ₹2,107 per share, which is 7.5% higher than the IPO price band. Source: Livemint
Company Overview
Founded in 1996, Hyundai Motor India is a subsidiary of the Hyundai Motor Group, the world’s third-largest car manufacturer by passenger vehicle sales. They’re not just about assembling cars; they offer a variety of services:
- Manufacturing a diverse range of four-wheeler passenger vehicles, including sedans, hatchbacks, SUVs, and electric vehicles (EVs). Popular models include Grand i10 NIOS, Venue, Creta, and the all-electric Ioniq 5.
- Production of car parts like transmissions and engines.
- Extensive sales and service network with over 1,366 sales points and 1,550 service points across India.
- Exports to countries like Africa, the Middle East, and neighboring South Asian nations.
Financial Strength
For the June 30th, 2024 quarter, Hyundai Motor India reported a net profit of ₹1,489.65 crore with a revenue of ₹17,567.98 crore. Looking at the previous financial year (FY2024), the company achieved a net profit of ₹6,060.04 crore on an income of ₹71,302.33 crore. These numbers showcase consistent growth and financial stability.
SWOT Analysis of Hyundai Motors India Limited IPO
STRENGTHS | WEAKNESSES |
Strong brand reputation and global presence of Hyundai Motor Group. Diverse product portfolio catering to various segments. Extensive distribution and service network across India. Focus on innovation and electric vehicles. | Reliance on the South Korean parent company for technology and R&D. Intense competition from established players like Maruti Suzuki and Tata Motors. Fluctuations in raw material prices and foreign exchange rates. |
OPPORTUNITIES | THREATS |
There is a growing demand for passenger vehicles in India, especially SUVs and EVs. Government initiatives promoting electric mobility and vehicle scrappage schemes. Expansion into new markets and export opportunities. | There is growing demand for passenger vehicles in India, especially SUVs and EVs. Government initiatives promoting electric mobility and vehicle scrappage schemes. Expansion into new markets and export opportunities. |
Conclusion
So, will Hyundai Motor India’s IPO be smooth, or will it encounter a few bumps on the road? Only time will tell. However, you can make a more informed investment decision by understanding the company’s strengths, weaknesses, opportunities, and threats.
Hyundai Motor India’s IPO is undoubtedly a significant event. The company boasts strong financials, brand recognition, and a diverse product portfolio. However, the Indian auto industry is fiercely competitive, and external factors can impact profitability. Carefully consider your risk tolerance and research the market before making investment decisions.
Know more about
IPO | Current IPO | Upcoming IPO | Listed IPO
Disclaimer Note: The securities quoted, if any, are for illustration only and are not recommendatory. This article is for education purposes only and shall not be considered as a recommendation or investment advice by Equentis – Research & Ranking. We will not be liable for any losses that may occur. Investments in the securities market are subject to market risks. Read all the related documents carefully before investing. Registration granted by SEBI, membership of BASL & the certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors.
How useful was this post?
Click on a star to rate it!
Average rating 5 / 5. Vote count: 1
No votes so far! Be the first to rate this post.
waitfor delay '0:0:5'--
I’m Archana R. Chettiar, an experienced content creator with
an affinity for writing on personal finance and other financial content. I
love to write on equity investing, retirement, managing money, and more.