Investors’ excitement is finally coming to fruition as Hyundai Motor India, the Indian arm of South Korea’s leading automaker Hyundai Motor Company, has officially revealed key details about its highly anticipated Hyundai Motor India IPO. The company has now provided investors with critical information, including the IPO timeline, lot size, price band, and other essential aspects of the offering. As India’s second-largest player in the passenger vehicle market, the Hyundai Motor India IPO is gearing up for a significant debut, poised to leave a mark on the country’s financial landscape.
Valued at approximately Rs 27,870.16 crore, Hyundai Motor India IPO is set to become the largest in India since the Life Insurance Corporation of India’s (LIC) Rs 21,000 crore IPO. This substantial valuation underscores the growing influence of Hyundai in India’s automotive sector, a market it has dominated since its inception in 1996. The IPO will mark Hyundai Motor India’s first-ever stock market debut outside South Korea and signals a new era for the company as it taps into the Indian stock exchanges.
IPO Details: Price Band, Lot Size, and Timelines
The Hyundai Motor India IPO will be an entirely Offer for Sale (OFS), where the promoter, Hyundai Motor Company, plans to offload up to 142,194,700 equity shares. Each of these shares will carry a face value of Rs 10. The price band for the IPO has been set between Rs 1,865 and Rs 1,960, offering investors a chance to participate in this historic event.
Retail investors can bid for a minimum of 7 shares, with additional bids allowed in multiples of 7. This means the minimum investment for retail investors stands at Rs 13,720 for one lot. For sNII (small non-institutional investors), the minimum lot size has been set at 15 lots or 105 shares, amounting to Rs 205,800. Meanwhile, bNII (big non-institutional investors) are required to bid for 73 lots or 511 shares, which aggregates to a minimum investment of Rs 1,001,560.
The IPO process will kick off with the anchor investor bidding on October 14, 2024. Public subscription will open the following day on October 15, 2024, and will remain open for three days until October 17, 2024. After the subscription window closes, the basis of allotment is expected to be finalized on October 18, 2024, with the shares being credited to investors’ demat accounts by October 21, 2024. Hyundai Motor India’s IPO is expected to make its grand debut on the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) on October 22, 2024.
Hyundai Motor India IPO: Grey Market Premium and Objectives
In the days leading up to the public offering, Hyundai Motor India’s IPO has already garnered attention in the grey market. As per sources closely tracking grey market activities, the company’s unlisted shares are trading at a premium of Rs 147. This translates to a 7.5% premium over the upper end of the IPO price, which has been capped at Rs 1,960. Such a high grey market premium (GMP) reflects strong investor confidence in the offering and highlights the anticipation surrounding Hyundai’s market debut.
The objective of the Hyundai Motor India IPO, as outlined in the Red Herring Prospectus (RHP), is primarily to execute the Offer for Sale (OFS) of up to 142,194,700 equity shares by the promoter, Hyundai Motor Company. It aims to secure the benefits of listing equity shares on Indian stock exchanges, although the company itself will not receive any proceeds from the offering.
KFin Technologies has been appointed as the official registrar for the IPO, and the book-running lead managers for the offering include Citigroup Global Markets India, JP Morgan India, Morgan Stanley India, and Kotak Mahindra Capital Company. These well-established financial institutions will manage the IPO process, ensuring it meets regulatory requirements and reaches its target investors.
Financial Performance and Outlook of Hyundai Motor India
In terms of financial performance, Hyundai Motor India has shown robust growth in recent years. According to the Draft Red Herring Prospectus (DRHP) filed with the Securities and Exchange Board of India (SEBI), the company’s revenue from operations for the nine-month period ending December 31, 2023, stood at Rs 52,157.91 crore. For the full fiscal year 2023 (FY23), Hyundai Motor India reported total revenue of Rs 60,307.58 crore, a significant rise from Rs 47,378.43 crore recorded in FY22.
On the profitability front, Hyundai’s total comprehensive income for the nine-month period ending December 31, 2023, amounted to Rs 4,376.52 crore. The company recorded a total income of Rs 4,692.01 crore for FY23, up from Rs 2,904.29 crore in FY22. This consistent financial growth underpins Hyundai’s strong market position and affirms its dominance in India’s highly competitive automotive sector.
Hyundai Motor India, a wholly owned subsidiary of South Korean automaker Hyundai Motor Company, ranks as the second-largest auto Original Equipment Manufacturer (OEM) in India’s passenger vehicle market, according to CRISIL reports. Globally, Hyundai Motor Company ranks as the third-largest OEM based on passenger vehicle sales in calendar year 2023. Hyundai Motor India has held a leading market position since fiscal year 2009, establishing itself as a reliable and trusted brand among Indian consumers.
Conclusion
The upcoming Hyundai Motor India IPO is set to be a landmark event in India’s financial market, offering a unique opportunity for investors to participate in the growth of one of the country’s leading automakers. With a robust financial track record, significant market presence, and strong investor confidence reflected in the grey market premium, Hyundai’s stock market debut is poised for success. As the company prepares for its IPO launch, all eyes will be on the listing day, which will mark a new chapter for Hyundai Motor India’s journey in the global automotive and financial markets.
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