Hyundai IPO: Hyundai Motor India Limited, the country’s most successful foreign automaker, has received approval from the Securities and Exchange Board of India (SEBI) for an IPO. Its IPO will be the biggest public issue till date. Hyundai, India’s second largest carmaker after Maruti Suzuki, can raise at least $ 3 billion (about Rs 25,000 crore) through IPO.
This will take the valuation of the company to approximately $18 billion or approximately Rs 1.5 lakh crore. Till now, LIC’s Rs 21,008 crore IPO launched in May 2022 has been India’s largest IPO. Hyundai’s IPO will involve the sale of 142 million shares, or a 17.5% stake, by its South Korean parent Hyundai Motor.
All Old Records Will be Broken
With this IPO, all the records of IPOs in the country till now will be broken. This is going to be the biggest IPO of the country. Earlier, Life Insurance Corporation of India’s IPO (LIC IPO) was around Rs 21,000 crore, Paytm’s IPO was Rs 18,300 crore, Coal India’s IPO was Rs 15,199 crore and Reliance Power IPO was Rs 11,563 crore. Came worth Rs. Swiggy’s IPO is also going to come in the market, which will be worth around Rs 10,000 crore.
India is The Third Largest Market For Hyundai
According to an ET report, Hyundai has received approval for an IPO. Currently there is no update on its listing. Hyundai will give investors an opportunity to invest in a highly profitable automobile company.The performance of auto companies in the stock markets has already been very good. India is the third largest revenue market for Hyundai globally after the US and South Korea.It has already invested $5 billion in the country, and plans to invest another $4 billion over the next decade.
When will Hyundai enter India?
Hyundai entered India in 1996 and entering the country was quite a challenge for automakers like Ford and General Motors. It gave tough competition to these companies with affordable hatchbacks like Santro. As customer needs changed with time, Hyundai launched its first made-in-India SUV in 2015.
The mid-size Creta was an instant success and became Hyundai’s highest grossing car. Hyundai now has eight SUVs in its portfolio of 13 cars, but its share of India’s total 2.5 million unit SUV sales last fiscal dropped to 19% from 24% three years ago.
According to an ET Prime report, Hyundai is getting 66% of its domestic business revenue from SUVs, which is higher than the industry average. The growing share of these high-priced, high-margin SUVs has boosted the company’s operating profit margin from an average of 7% in FY16-23 to 9.5% in FY24 (nine months).
Hyundai IPO: Hyundai Motors Will Not issue New Shares
Hyundai India had submitted its papers to SEBI in June to launch an IPO. In this IPO, Hyundai India’s promoter company Hyundai Motors will sell some of its stake and about 14,21,94,700 shares will be put up for sale (OFS). Hyundai Motor India sells 13 models in India ranging from commuter car to SUV segment. Its paired company Kia motors also has major areas of strength for an in India.
In India, an automobile company is going to be listed in the stock market after about 20 years. Earlier in the year 2003, the country’s largest automobile company Maruti Suzuki India had launched its IPO.
After America and South Korea, Hyundai generates the highest revenue in India. This company can increase capitalization by bringing IPO also, it can expand its capacity rapidly in the market. According to DHRP, the Korean company can sell its 17.5 percent stake in Hyundai Motors India Limited. Hyundai has roped in investment banks like Kotak Mahindra, citibank, morgan stanley,JP Morgan and HSBC to ease its entry into the public market and make it successful. after the company can soon share the price band and other details of hyundai IPO
