Hyundai Motor IPO Launches on October 15: Key Details You Should Know

The initial public offering (IPO) of Hyundai Motor India, the country’s second-largest automaker, is set to make history as India’s largest IPO. Scheduled to launch on Tuesday, October 15, 2024, the company aims to raise a massive Rs 27,855 crore, marking a significant milestone in the Indian stock market. The subscription window for the IPO will remain open until Thursday, October 17.

Key IPO Details: Pricing and Investment

Hyundai Motor India is offering its shares in the price range of Rs 1,865 to Rs 1,960 per share. Investors can apply for a minimum of seven equity shares and multiples thereafter. For retail investors, the minimum investment required is Rs 13,720, making the IPO accessible to a wide range of investors. This pricing structure has garnered significant attention, given Hyundai’s position in the automobile market.

The IPO will be an offer for sale (OFS) by Hyundai Motor Company, the South Korean parent, which plans to sell up to 14.21 crore equity shares. At the upper price band of Rs 1,960 per share, the offering is expected to break previous records for IPO size in India.

Allocation of Shares

The Hyundai Motor India IPO comes with a well-structured allocation plan designed to cater to different types of investors. The IPO includes a reservation of 7.78 lakh shares specifically for eligible employees, who will benefit from a discount of Rs 186 per share.

In terms of allocation, the company has set aside:

• 50% of the net offer for Qualified Institutional Buyers (QIBs).

• 15% for Non-Institutional Investors (NIIs).

• The remaining 35% will be allocated to retail investors.

This allocation strategy ensures that a wide range of investors, from institutions to individuals, will have the opportunity to participate in Hyundai’s market debut.

Allotment and Listing Details

Several prestigious financial institutions are managing the Hyundai Motor India IPO. Kotak Mahindra Capital, JP Morgan India, Citigroup Global Markets India, HSBC Securities & Capital Markets, and Morgan Stanley India are the lead managers. Additionally, Kfin Technologies has been appointed as the registrar for the issue, ensuring a smooth process for investors.

The share allotment for the Hyundai IPO is expected to be finalized by Friday, October 18, 2024. Investors are eagerly awaiting the listing date, which is tentatively set for Tuesday, October 22, with shares likely to be traded on both the BSE and NSE.

Hyundai Motor India: An Overview

Founded in May 1996 and headquartered in Chennai, Hyundai Motor India has solidified its presence as a key player in the Indian automotive market. As part of the Hyundai Motor Group, which ranks as the world’s third-largest automaker by passenger vehicle sales, Hyundai Motor India has been instrumental in the group’s success.

The company’s Indian subsidiary is involved in the production and sale of a diverse range of vehicles, including sedans, hatchbacks, SUVs, and electric vehicles (EVs). In addition to vehicle manufacturing, the company also produces essential automotive components, such as engines and transmissions, further showcasing its integral role in the automotive supply chain.

Proceeds from the IPO

While the IPO is expected to generate significant capital, Hyundai Motor India itself will not receive any direct proceeds. The funds raised from the IPO will go to the parent company in South Korea, as this offering is structured as an offer for sale (OFS). Despite this, the IPO is expected to boost Hyundai Motor India’s market valuation to a substantial Rs 1.6 lakh crore, reinforcing the company’s leadership in the Indian automotive industry.

Hyundai’s Extensive Network in India

Hyundai Motor India boasts an impressive presence across the country, with a well-established sales and service network. The company operates through 1,366 sales points and 1,550 service locations, ensuring extensive customer support. Hyundai has sold nearly 12 million vehicles in India and has a robust export operation, shipping vehicles to countries such as Africa, the Middle East, Bangladesh, Nepal, Bhutan, and Sri Lanka.

The company collaborates with 363 dealer companies across India, further enhancing its distribution and sales reach. Popular models in the Indian market include the Grand i10 NIOS, i20, i20 N Line, AURA, Elantra, Venue, Verna, Creta, Alcazar, Tucson, and the Ioniq 5 electric SUV.

Financial Performance

Hyundai Motor India’s financial performance has been impressive, adding further credibility to its IPO. For the quarter ending June 30, 2024, the company posted a net profit of Rs 1,489.65 crore, with revenues amounting to Rs 17,567.98 crore. For the fiscal year ending March 31, 2024, Hyundai reported a net profit of Rs 6,060.04 crore and revenues of Rs 71,302.33 crore.

This strong financial standing has made the Hyundai Motor India IPO highly anticipated among investors, who are eager to capitalize on the company’s proven track record of profitability and growth.

Conclusion

With its solid financial performance, extensive market presence, and status as the second-largest carmaker in India, Hyundai Motor India is set to make waves with its upcoming IPO. The offering not only marks a significant moment in Indian stock market history but also provides investors with an exciting opportunity to be part of one of the most successful automotive brands in the country.