(Photo : Hyundai)
Hyundai

• Hyundai Motor India's IPO aims to raise Rs 27,870 crore, making it the largest-ever in the Indian equity market since 2022.
• This is the first time an automaker has listed in India in over two decades, with all proceeds going to the promoter, Hyundai Motor Company.
• Hyundai holds a 14.6% market share in the domestic passenger vehicle market and leads in the mid-size SUV segment with a 38% share.
• The IPO underscores the robustness of the Indian equity market and highlights the growing prominence of automakers in the country's economic landscape.

In a move that has sent waves of anticipation through Dalal Street, Hyundai Motor India has launched its initial public offering (IPO) for retail investors. The IPO, which opened on Tuesday, aims to raise a staggering Rs 27,870 crore. This makes it the largest-ever IPO in the Indian equity market since 2022, surpassing the Life Insurance Corporation of India's (LIC) IPO, which raised Rs 21,000 crore.

The IPO will remain open until October 17, with the price band set at Rs 1,865 to Rs 1,960 per share. Each lot of Hyundai Motor India's IPO consists of seven shares. Once the subscription window closes, the share allotment is expected to be finalized on October 18, with shares being credited to demat accounts by October 21.

Hyundai's IPO: A First in Two Decades

This IPO is not just significant due to its size, but also because it marks the first time an automaker has listed in India in over two decades. The entire proceeds from this maiden share sale, which is a pure offer for sale (OFS), will go to the promoter, Hyundai Motor Company.

In the run-up to the IPO, Hyundai Motor India managed to raise approximately Rs 8,315 crore from anchor investors. The company allotted 4.24 crore shares at Rs 1,960 apiece to 225 anchor investors, as per the company's statement.

Hyundai's Market Presence and Financial Performance

Hyundai Motor India has been a significant player in the domestic passenger vehicle (PV) market, holding a 14.6% market share in Q1 FY25. This places it second only to Maruti Suzuki, which holds a 41% share in this category. However, Hyundai leads the market by volume in the mid-size SUV segment, with a 38% share as of June 2024. From April 2021 through June 2024, Hyundai was also India's second-largest exporter of PV.

In the last financial year, the company sold 7.77 lakh vehicles, 21% of which were exported to countries like Africa, Middle East, Europe, and Latin America. Hyundai Motor India's revenue in the financial year 2023-24 was Rs 69,829 crore, with a profit of Rs 6,060 crore and a margin of 13.1%. In the first quarter of FY 2024-25, the company's revenue was Rs 17,344 crore, with a profit of Rs 1,489 crore and a margin of 13.5%.

The company's extensive network includes 1,366 sales outlets and 1,550 service outlets across the country. This wide reach, coupled with its strong financial performance, makes Hyundai Motor India a formidable player in the Indian automotive industry.

The Hyundai Motor India IPO is reminiscent of the Maruti Suzuki India Ltd's IPO, which was a significant event in the Indian equity market. Maruti Suzuki, one of Hyundai's listed peers, has a P/E of 29.38, while other peers like Tata Motors Ltd and Mahindra & Mahindra Ltd have P/Es of 11.36 and 29.96 respectively, as per the red herring prospectus (RHP).

As Hyundai Motor India gears up for its shares to debut on stock exchanges, all eyes are on how this historic event will unfold and shape the future of the Indian automotive industry. This IPO is a significant milestone for Hyundai Motor India and the Indian equity market at large. It not only underscores the robustness of the Indian equity market but also highlights the growing prominence of automakers in the country's economic landscape.