As of the latest Hyundai IPO news reports, Hyundai Motor India‘s IPO stands as the largest in India’s history, raising ₹27,870 crore surpassing the previous record of ₹21,000 crore raised by LIC in its IPO.
The Hyundai IPO was an Offer For Sale, consisting of 14,21,94,700 equity shares offered by the parent company Hyundai Motor Company, with no fresh issue of shares.
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Hyundai Motor India’s IPO raised Rs 27,855 crore, making it the largest-ever public offering in India. The IPO priced at Rs 1,960 per share.
However, the listing at Rs 1,931 on the Bombay Stock Exchange and Rs 1,934 on the National Stock Exchange reflected a discount of 1.47% and 1.32%, respectively from the IPO price.
Hyundai Motor India opened its trading on October 22, 2024, with a price of Rs 1,934 on the NSE and Rs 1,931 on the BSE, below its offer price of Rs 1,960 per share.
The stock’s performance showed initial recovery, touching a high of Rs 1,968.80, a marginal increase of 0.44% from its listing price.
However, this momentum could not be sustained. By the end of the trading day, Hyundai Motor India’s share price had dropped to Rs 1,820.40, closing in the red with a 5.81% decline from its issue price.
As of the latest Hyundai IPO news reports, the IPO received a lackluster response from retail investors, despite strong backing from Qualified Institutional Buyers.
The QIB portion was oversubscribed by nearly 700%, compensating for the tepid retail participation. The market conditions also impacted Hyundai’s debut.
With Nifty and Sensex extending their losses to reach two-month lows, overall market sentiment contributed to the subdued listing of Hyundai Motor India.
Despite the initial decline in share price, Hyundai Motor India’s market capitalization stood at Rs 1.59 lakh crore as of October 22, 2024.
As of the latest Hyundai IPO news reports, this market cap made Hyundai the fifth most valuable automaker in India, behind Maruti Suzuki (Rs 3.83 lakh crore), Mahindra & Mahindra (Rs 3.73 lakh crore), Tata Motors (Rs 3.32 lakh crore) and Bajaj Auto (Rs 2.93 lakh crore).
Hyundai’s IPO also ranked it among the top 60 most valuable companies in India.
Emkay assigned a Reduce rating to Hyundai Motor India, setting a target price of Rs 1,750, which indicated an 11% downside from the IPO price. The brokerage cited limited growth prospects in the near term, estimating a muted 5% Earnings Per Share Compound Annual Growth Rate for FY24-27.
Motilal Oswal initiated coverage with a Buy rating, with a target price of Rs 2,345, expecting better performance based on Hyundai’s alignment with industry trends and its strong brand perception.
Nomura pointed to Hyundai’s premiumization strategy, predicting an 8% volume CAGR over FY25-27 driven by the launch of 7-8 new models and facelifts.
Hyundai Motor India’s IPO was oversubscribed by 2.37 times driven by institutional investors who aggressively bid for shares.
Despite the heavy interest from institutional investors, retail participation was lackluster. The portion of the IPO reserved for retail investors was only subscribed 50%.
Institutional buyers including Foreign Institutional Investors, subscribed nearly seven times the shares allocated to them.
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As of the latest Hyundai IPO news reports, Hyundai set the price band for its shares between ₹1,865 and ₹1,960 with the final issue price at the upper end of the band ₹1,960 per share.
The stock debuted at a discount on both the Bombay Stock Exchange and the National Stock Exchange , trading at ₹1,931 on BSE and ₹1,934 on NSE, down approximately 1.47% and 1.32% from the issue price.
The disappointing start raised concerns among investors who were hoping for a strong listing. Hyundai IPO news highlighted that this debut was contrary to expectations of a premium listing given the high subscription rates from institutional buyers.
Despite a brief rally where the stock touched a high of ₹1,968.80, the stock closed at ₹1,819, a 7.16% decline from the issue price.
As of the latest Hyundai IPO news reports, On the NSE, Hyundai shares saw a similar pattern starting at ₹1,934, reaching a low of ₹1,870 and ending with a 7.6% decline at ₹1,819. This underwhelming performance led many to question the pricing strategy of the IPO.
Hyundai Motor India’s market capitalization at the time of listing stood at ₹1.57 lakh crore, targeting a valuation similar to that of its parent company in South Korea.
Hyundai Motor India holds the position of the second-largest original equipment manufacturer in the Indian automotive sector, with a 14.6% market share.
It is also the second-largest exporter of passenger vehicles from India. In September 2024, Hyundai’s sales stood at 64,201 units, a 10% year-on-year decline.
However, the total sales for 2024 so far amounted to 5.77 lakh units, remaining flat compared to the previous year.
As of the latest Hyundai IPO news reports, Hyundai’s IPO was priced at 26 times its FY24 earnings, close to Maruti Suzuki’s multiple of 29. The narrow gap in price-to-earnings ratios raised concerns among analysts.
Market analysts pointed to a trend where seven out of India’s top 10 largest IPOs reported listing day losses ranging from 5% to 27%.
Emkay highlighted challenges facing Hyundai Motor India including higher royalty payments, limited new launches in the next 12-18 months and subdued capacity expansion.
Emkay favors Maruti Suzuki due to its product and powertrain mix and its expansion plans, which include 10 new models by 2030 and a 7-seater SUV launch by H2FY26.
Hyundai Motor India spent Rs 624 crore on its IPO, the highest amount ever spent by a company to list on Indian stock exchanges. This equated to 2.24% of the total issue size.
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