In a landmark move, Hyundai Motor India is gearing up for its ₹27,000 crore IPO (Initial Public Offering), expected to be India’s largest public issue for the automotive sector. The IPO will launch on October 15-17, 2024, and is anticipated to attract widespread investor interest, marking a historic moment for Hyundai as well as the broader Indian automobile market.
Key Details of Hyundai’s IPO
The offer will include the sale of 142 million shares, representing a 17.5% stake in Hyundai Motor India. This makes it not only the largest IPO in the sector but also the first time since Maruti Suzuki in 2003 that an Indian automaker will go public. Hyundai’s IPO, if successful, will surpass the record set by the ₹21,008 crore IPO of LIC in 2022, making it one of the most significant financial events in the country.
The share price will be set between ₹1,865 to ₹1,960, with 50% reserved for qualified institutional buyers (QIBs), 35% for retail investors, and 15% for non-institutional investors (NIIs). A small portion of the shares will be reserved for employees at a discounted price, making this a highly inclusive offering.
Hyundai’s Strategic Move in India
The IPO isn’t just about raising capital. Hyundai’s move reflects its long-term vision for strengthening its presence in India, one of the fastest-growing automotive markets globally. Since entering India in 1996, Hyundai has established itself as a major player, with iconic models such as the Creta and Santro. The company’s two manufacturing plants in India play a vital role in the country’s automobile export business, with Hyundai being the largest exporter of passenger vehicles since 2005.
India has been Hyundai’s third-largest revenue generator globally, trailing behind South Korea and the UK, and the IPO will enhance the company’s ability to further capitalize on this growth. The funds raised through this public issue will be directed towards expanding production capacities, enhancing technology, and scaling up the company’s operations in India. This aligns with Hyundai’s strategic push to maintain and grow its share of the Indian market amid increasing competition from both domestic and international automakers.
What Does This Mean for the Indian Auto Industry?
The IPO is expected to boost Hyundai’s visibility and brand image in India, helping it solidify its status as a leader in the Indian automotive market. The offering will also provide liquidity, creating a public market for Hyundai shares that could pave the way for future capital infusions to support the company’s expansion and innovation initiatives in India.
Further, the IPO comes at a time when consumer preferences in India are shifting, with increasing demand for SUVs and electric vehicles (EVs). Hyundai has already made significant strides in this segment, and the additional funds will likely support more R&D in EVs and other future mobility solutions.
Investor Opportunities and Market Impact
For investors, Hyundai’s IPO presents a compelling opportunity to invest in a globally recognized brand that has a strong foothold in one of the world’s largest automotive markets. Given Hyundai’s track record of success in India and its role as a market leader, many expect the IPO to perform well, especially with strong demand from institutional investors and retail segments alike.
With Hyundai’s reputation for quality, innovation, and a wide-ranging portfolio of vehicles, the IPO is expected to garner significant attention in the Indian stock market and beyond.
This IPO not only marks a significant moment for Hyundai but also sets the stage for further growth and innovation in India’s rapidly evolving automobile sector. As the Indian auto industry continues to boom, Hyundai’s IPO could pave the way for greater investments in the country’s automotive future.
