{"id":46615,"date":"2024-10-17T17:29:34","date_gmt":"2024-10-17T11:59:34","guid":{"rendered":"https:\/\/www.equentis.com\/blog\/?p=46615"},"modified":"2025-11-10T13:34:54","modified_gmt":"2025-11-10T08:04:54","slug":"hyundai-ipo-slows-with-42-subscription-on-day-2-4-reasons-why","status":"publish","type":"post","link":"https:\/\/www.equentis.com\/blog\/hyundai-ipo-slows-with-42-subscription-on-day-2-4-reasons-why\/","title":{"rendered":"Hyundai IPO Hits a Speed Bump With 42% Subscription On Day 2 : 4 Reasons Why"},"content":{"rendered":"<div id=\"bsf_rt_marker\"><\/div>\n<p>Hyundai Motor India (HMI) has dominated the automotive market since its 1996 launch in India. Understandably, when the country\u2019s second-largest car manufacturer\u2019s (after Maruti) IPO launched on 15 October, it was met with much anticipation. However, the \u20b927,870 crore IPO, the largest in India&#8217;s history, saw merely 0.18 times subscription on its opening day. While the subscription stood at 42% on Day 2, it shot up marginally to 51% on the closing day, with its GMP sinking to below 1%.  <em>Source: <a href=\"https:\/\/www.livemint.com\/market\/ipo\/hyundai-motor-india-ipo-sees-slow-pick-up-as-analysts-raise-high-valuation-concern-11728986210428.html\" target=\"_blank\" rel=\"noopener\">Mint<\/a><\/em><\/p>\n\n\n\n<p>Market experts are attributing the lukewarm response to many factors. Here\u2019s a lowdown on what these are and how the <a href=\"https:\/\/www.equentis.com\/ipos\">IPO<\/a> has performed so far:<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-large-font-size\"><strong>All You Need To Know About the <a href=\"https:\/\/www.equentis.com\/stocks-screener\/hyundai-share-price\">Hyundai IPO<\/a><\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The <a class=\"wpil_keyword_link\" href=\"https:\/\/www.equentis.com\/ipos\" title=\"IPO\" link=\"linked\" id=\"421\">IPO<\/a> has a price range of \u20b91,865 to \u20b91,960 per share<\/li>\n\n\n\n<li>The NII portion, comprising high-net-worth individuals, was subscribed 0.13 times, while retail investors subscribed 0.26 times. The portion for employees (discounted price of \u20b9186 per share) was subscribed 0.8 times (80%).<\/li>\n\n\n\n<li>35% of share reservation is for retail investors, 50% for qualified institutional buyers (QIBs), and 15% for NIIs.<\/li>\n\n\n\n<li>\u20b98,315 crore (about 30% of the <a class=\"wpil_keyword_link\" href=\"https:\/\/www.equentis.com\/ipos\" title=\"IPO\" link=\"linked\" id=\"747\">IPO<\/a> size) was raised from 225 anchor investors, including funds owned by the Singapore government<\/li>\n<\/ul>\n\n\n\n<p>Source: <a href=\"https:\/\/economictimes.indiatimes.com\/markets\/ipos\/fpos\/hyundai-motor-ipos-off-to-a-slow-start\/articleshow\/114265952.cms\" target=\"_blank\" rel=\"noopener\">Economic Times<\/a><\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Hyundai IPO &#8211; <strong>One of the Largest in India in 2024<\/strong><\/h2>\n\n\n\n<p>Hyundai is one of the largest IPOs in India this year and joins the ranks of other big names in various sectors:&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-table aligncenter\"><table class=\"has-fixed-layout\"><tbody><tr><td class=\"has-text-align-center\" data-align=\"center\"><strong>Sr<\/strong><\/td><td class=\"has-text-align-center\" data-align=\"center\"><strong>Issue Name<\/strong><\/td><td class=\"has-text-align-center\" data-align=\"center\"><strong>Issue Size (Rs Cr)<\/strong><\/td><td class=\"has-text-align-center\" data-align=\"center\"><strong>Listing Date<\/strong><\/td><td class=\"has-text-align-center\" data-align=\"center\"><strong>Offer Price (Rs)<\/strong><\/td><td class=\"has-text-align-center\" data-align=\"center\"><strong>Total Subscription (Rs in Crores)<\/strong><\/td><\/tr><tr><td class=\"has-text-align-center\" data-align=\"center\">1<\/td><td class=\"has-text-align-center\" data-align=\"center\">Hyundai Motors India<\/td><td class=\"has-text-align-center\" data-align=\"center\">27,870.16<\/td><td class=\"has-text-align-center\" data-align=\"center\">Oct 22, 2024<\/td><td class=\"has-text-align-center\" data-align=\"center\">1,865 &#8211; 1,960<\/td><td class=\"has-text-align-center\" data-align=\"center\">41,889.50<\/td><\/tr><tr><td class=\"has-text-align-center\" data-align=\"center\">2<\/td><td class=\"has-text-align-center\" data-align=\"center\"><a href=\"https:\/\/www.equentis.com\/stocks-screener\/vodafone-idea_132822\" data-type=\"link\" data-id=\"https:\/\/www.equentis.com\/stocks-screener\/vodafone-idea_132822\">Vodafone Idea Limited<\/a><\/td><td class=\"has-text-align-center\" data-align=\"center\">18,000<\/td><td class=\"has-text-align-center\" data-align=\"center\">Apr 25, 2024<\/td><td class=\"has-text-align-center\" data-align=\"center\">11<\/td><td class=\"has-text-align-center\" data-align=\"center\">1,25,820<\/td><\/tr><tr><td class=\"has-text-align-center\" data-align=\"center\">3<\/td><td class=\"has-text-align-center\" data-align=\"center\"><a href=\"https:\/\/www.equentis.com\/stocks-screener\/bajaj-housing-financ_228460\" data-type=\"link\" data-id=\"https:\/\/www.equentis.com\/stocks-screener\/bajaj-housing-financ_228460\">Bajaj Housing Finance Limited<\/a><\/td><td class=\"has-text-align-center\" data-align=\"center\">6,560<\/td><td class=\"has-text-align-center\" data-align=\"center\">Sep 16, 2024<\/td><td class=\"has-text-align-center\" data-align=\"center\">70<\/td><td class=\"has-text-align-center\" data-align=\"center\">4,42,340.8<\/td><\/tr><tr><td class=\"has-text-align-center\" data-align=\"center\">4<\/td><td class=\"has-text-align-center\" data-align=\"center\"><a href=\"https:\/\/www.equentis.com\/stocks-screener\/ola-electric-mobilit_296367\" data-type=\"link\" data-id=\"https:\/\/www.equentis.com\/stocks-screener\/ola-electric-mobilit_296367\">Ola Electric Mobility Limited<\/a><\/td><td class=\"has-text-align-center\" data-align=\"center\">6,145.56<\/td><td class=\"has-text-align-center\" data-align=\"center\">Aug 09, 2024<\/td><td class=\"has-text-align-center\" data-align=\"center\">76<\/td><td class=\"has-text-align-center\" data-align=\"center\">27,347.74<\/td><\/tr><tr><td class=\"has-text-align-center\" data-align=\"center\">5<\/td><td class=\"has-text-align-center\" data-align=\"center\"><a href=\"https:\/\/www.equentis.com\/stocks-screener\/bharti-hexacom-ltd._207872\" data-type=\"link\" data-id=\"https:\/\/www.equentis.com\/stocks-screener\/bharti-hexacom-ltd._207872\">Bharti Hexacom Limited<\/a><\/td><td class=\"has-text-align-center\" data-align=\"center\">4,275<\/td><td class=\"has-text-align-center\" data-align=\"center\">Apr 12, 2024<\/td><td class=\"has-text-align-center\" data-align=\"center\">570<\/td><td class=\"has-text-align-center\" data-align=\"center\">1,27,737<\/td><\/tr><\/tbody><\/table><figcaption class=\"wp-element-caption\">Source:<a href=\"https:\/\/www.chittorgarh.com\/report\/biggest-ipo-in-india-by-issue-size-year-wise\/108\/\" target=\"_blank\" rel=\"noopener\"> Chittorgarh<\/a><\/figcaption><\/figure>\n\n\n\n<p>However, despite the initial buzz, Hyundai\u2019s <a class=\"wpil_keyword_link\" href=\"https:\/\/www.equentis.com\/researchandranking\/ipos\" title=\"IPO\" data-wpil-keyword-link=\"linked\" data-wpil-monitor-id=\"1044\">IPO<\/a> witnessed an unexpected slowdown. Here are the top reasons why.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-large-font-size\"><strong>4 Factors Why Hyundai IPO Didn\u2019t Shift into Top Gear<\/strong><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>High Offer Price&nbsp;<\/strong><\/h3>\n\n\n\n<p>One of the biggest concerns investors have raised is the IPO pricing. Many analysts believe the offer price was at the higher end of the spectrum, discouraging potential buyers. Indian investors have become accustomed to a fair IPO bump, and the prospect of limited gains or losses has reduced the enthusiasm.<\/p>\n\n\n\n<p>A more attractive pricing could have garnered wider support from retail and institutional investors, creating a positive buzz around the listing. Instead, the high valuation may have deterred many potential buyers, who may now wait for a more favorable entry point.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Massive Cash Outflow to Korea<\/strong><\/h3>\n\n\n\n<p>Hyundai Motor India&#8217;s substantial dividend payouts to its South Korean parent company have also raised investor concerns. The large amount of money transferred from India has created a negative perception, particularly when the government actively promotes <a href=\"https:\/\/www.equentis.com\/blog\/understanding-foreign-investments-fdi-vs-fii\/\">foreign direct investment<\/a> (FDI) in the automotive sector.<\/p>\n\n\n\n<p>While the company has clarified the legal nature of these transactions, the sheer amount of the cash outflow has raised questions. A more transparent communication strategy could have helped minimize concerns and highlight the positive aspects of these transactions, including Hyundai\u2019s success in the Indian market.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Concerns About Financial Stability<\/strong><\/h3>\n\n\n\n<p>The decrease in cash and bank balances due to dividend payments has also increased concerns about Hyundai&#8217;s expansion plans. Investors may be worried that the company may have to rely heavily on external borrowings to fund its future growth, potentially impacting its financial performance and stability.<\/p>\n\n\n\n<p>While the company&#8217;s balance sheet is light on assets and the cash flow from operations is robust, which could mitigate financial stability concerns, a more proactive communication strategy would have been beneficial in addressing investor anxieties and maintaining confidence.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Prioritizing South Korean Interests<\/strong><\/h3>\n\n\n\n<p>There is a perception that Hyundai Motor Company&#8217;s primary motivation for the IPO was to improve its valuation back home in South Korea. This suggests that the company may have prioritized its interests over those of Indian investors.<\/p>\n\n\n\n<p>While the IPO could have been a win-win situation for both parties, the focus on maximizing benefits for South Korean shareholders may have alienated Indian investors. A more balanced approach considering the interests of domestic and foreign investors would have been more conducive to the IPO&#8217;s success.<\/p>\n\n\n\n<p><strong>Conclusion<\/strong><\/p>\n\n\n\n<p>Hyundai was among India&#8217;s most anticipated IPOs. However, its slow performance offers valuable lessons for future issuers. A well-thought-out pricing strategy, transparent communication, and a focus on aligning the interests of all stakeholders are crucial for attracting investor interest and ensuring the success of an IPO. By addressing these mistakes, Hyundai can learn from this experience and position itself for future growth in the Indian market.<\/p>\n\n\n\n<p class=\"has-ast-global-color-5-color has-text-color has-background has-link-color wp-elements-a6cbbd1569861f2fc362435c8706dacb\" style=\"background-color:#001e5a\"><strong>Know more about:<br><a href=\"https:\/\/www.equentis.com\/ipos\">IPOs<\/a>&nbsp;|&nbsp;<a href=\"https:\/\/www.equentis.com\/ipos\/current-new-ipos\">Current IPOs<\/a><a href=\"https:\/\/www.equentis.com\/ipos\/current-new-ipos\">&nbsp;<\/a>|&nbsp;<a href=\"https:\/\/www.equentis.com\/ipos\/upcoming-ipos\">Upcoming IPOs <\/a>|&nbsp;<a href=\"https:\/\/www.equentis.com\/ipos\/listed-ipos\">Listed IPO<\/a>s | <a href=\"https:\/\/www.equentis.com\/ipos\/current-new-ipos\">Closed IPOs<\/a> | <a data-wpil=\"url\" href=\"https:\/\/www.equentis.com\/ipos\/ipo-performers\">IPO Performers<\/a><\/strong><\/p>\n\n\n\n<p class=\"has-ast-global-color-5-color has-vivid-red-background-color has-text-color has-background has-link-color wp-elements-9ce0f53ce9b064a07752f45f1a6f5b01\">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 &#8211; Research &amp; Ranking. We will not be liable for any losses that may occur. <a href=\"https:\/\/www.equentis.com\/blog\/mukul-agrawal-portfolio-shareholdings-investments-all-you-need-to-know\/\">Investments<\/a> in the securities market are subject to market risks. Read all the related documents carefully before investing. Registration granted by <a href=\"https:\/\/www.equentis.com\/blog\/sebi-registered-investment-advisor-meaning-eligibility\/\">SEBI<\/a>, membership of BASL &amp; the certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">FAQ<\/h2>\n\n\n<div class=\"saswp-faq-block-section\"><ol style=\"list-style-type:none\"><li style=\"list-style-type: none\"><h3 class=\"\"><strong>Why did Hyundai Motor India&#8217;s IPO not receive the expected subscription levels?<\/strong><\/h3><p class=\"saswp-faq-answer-text\">Several factors contributed to the slow subscription for Hyundai&#8217;s IPO. These include the IPO&#8217;s perceived high price, the company&#8217;s substantial dividend payouts to its South Korean parent, concerns about its financial stability, and the perception that Hyundai Motor Company prioritized its interests over those of Indian investors.<\/p><li style=\"list-style-type: none\"><h3 class=\"\"><strong>What was the subscription rate for Hyundai&#8217;s IPO on Day 3?<\/strong><\/h3><p class=\"saswp-faq-answer-text\">The subscription rate for Hyundai&#8217;s IPO on Day 3 was 51%.<br>Source: <a href=\"https:\/\/www.cnbctv18.com\/market\/hyundai-motor-india-ipo-day-3-know-gmp-will-the-issue-see-full-subscription-on-the-final-day-19494303.htm\" target=\"_blank\" rel=\"noopener\">cnbcTV 18.com<\/a><\/p><li style=\"list-style-type: none\"><h3 class=\"\"><strong>How much did Hyundai Motor India raise from anchor investors?<\/strong><\/h3><p class=\"saswp-faq-answer-text\">Hyundai Motor India raised \u20b98,315 crore (about 30% of the IPO size) from 225 anchor investors.<\/p><li style=\"list-style-type: none\"><h3 class=\"\"><strong>What\u2019s Hyundai&#8217;s IPO subscription among different investor categories?<\/strong><\/h3><p class=\"saswp-faq-answer-text\">The subscription for Hyundai&#8217;s IPO was moderate across all investor categories. Retail investors subscribed 0.26 times, qualified institutional buyers (QIBs) subscribed 0.41 times, and non-institutional investors (NIIs) subscribed 0.13 times.<\/p><li style=\"list-style-type: none\"><h3 class=\"\"><strong>What lessons can be learned from Hyundai&#8217;s IPO experience?<\/strong><\/h3><p class=\"saswp-faq-answer-text\">Hyundai&#8217;s IPO experience highlights the importance of fair pricing, transparent communication, and balancing the interests of all stakeholders. By addressing these factors, future issuers can improve their chances of attracting investor interest and ensuring the success of their IPOs.<\/p><\/ul><\/div>","protected":false},"excerpt":{"rendered":"<p>Hyundai Motor India (HMI) has dominated the automotive market since its 1996 launch in India. Understandably, when the country\u2019s second-largest car manufacturer\u2019s (after Maruti) IPO launched on 15 October, it was met with much anticipation. <\/p>\n","protected":false},"author":5,"featured_media":46638,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[948,553],"tags":[],"class_list":["post-46615","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-stock-market-news","category-investing-ipo"],"_links":{"self":[{"href":"https:\/\/www.equentis.com\/blog\/wp-json\/wp\/v2\/posts\/46615","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.equentis.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.equentis.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.equentis.com\/blog\/wp-json\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/www.equentis.com\/blog\/wp-json\/wp\/v2\/comments?post=46615"}],"version-history":[{"count":24,"href":"https:\/\/www.equentis.com\/blog\/wp-json\/wp\/v2\/posts\/46615\/revisions"}],"predecessor-version":[{"id":63217,"href":"https:\/\/www.equentis.com\/blog\/wp-json\/wp\/v2\/posts\/46615\/revisions\/63217"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.equentis.com\/blog\/wp-json\/wp\/v2\/media\/46638"}],"wp:attachment":[{"href":"https:\/\/www.equentis.com\/blog\/wp-json\/wp\/v2\/media?parent=46615"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.equentis.com\/blog\/wp-json\/wp\/v2\/categories?post=46615"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.equentis.com\/blog\/wp-json\/wp\/v2\/tags?post=46615"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}