Around 11:20 a.m., the greatest demand was driven by retail investors, who subscribed to the issue with 13%, followed by non-institutional investors, who have so far reserved the issue with 6%. The portion reserved for qualified institutional buyers (QIBs) attracted only 252 bids as against 2,82,83,260 shares reserved for them.
The issue is entirely an offer for sale (OFS) of 14.2 crore shares, which will be sold by the company’s parent company, Hyundai Motor Global. Since the IPO is an SFO, all proceeds will go to the selling shareholder.
Although all proceeds from the IPO will go to the parent company, management said the funds will be used for research and development and innovative new offerings.
In the unlisted market, the company’s shares were trading at Rs 35-40 before the issue opened, indicating a marginal premium of 2% over the IPO price. GMP has been in free fall since the issue was announced.
Hyundai IPO Price Band
The company has set a price band of Rs 1,865 to Rs 1,960 per share, where investors can bid for 7 shares in one lot.
Hyundai IPO GMP
In the unlisted market, the company’s shares were trading at Rs 65 before the issue opened, indicating a marginal premium of 3.3% over the IPO price. GMP has been in free fall since the issue was announced.
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Hyundai India IPO Review
Most analysts advised investors to subscribe to the IPO for the long term as the company has a strong brand presence in India and is well poised to tap growth opportunities in the passenger car market.
“We assign an underwrite rating to Hyundai given continued growth prospects amid industry tailwinds, strong financials and a healthy SUV product lineup. We expect limited listing gains for this IPO, however, we expect the company generate healthy double-digit portfolio returns in the medium to long term,” ICICI Direct said.
“At the upper band, the company is valued at 26.2 times its FY24 earnings, in addition to being valued at 26.7 times if we annualize FY25 earnings. We believe the issue is fully priced and recommend Subscribe – Long-term rating for IPO,” Anand Rathi said.
Other details
Hyundai is India’s second largest automaker with a portfolio of 13 passenger vehicle models across sedans, hatchbacks and SUVs. The company aims to leverage its strong local manufacturing capabilities to position itself as Hyundai Motor’s largest production base in Asia.
It operates two manufacturing facilities in Chennai with a combined installed capacity of 8.24 lakh units per annum and is currently operating at over 90% capacity utilization.
For the quarter ended June 2024, Hyundai Motor India reported revenue of Rs 17,344 crore, up from Rs 16,624 crore in the same period last year. Of the total income, 76% came from the domestic market, while exports represented 24%.
The company’s net profit for the quarter stood at Rs 1,489.65 crore, compared to Rs 1,329.19 crore a year earlier.
Kotak Mahindra Capital, Citigroup Global, HSBC Securities, JP Morgan and Morgan Stanley are the lead bookrunners for the issue, while KFin Technologies is the registrar for the offer.
(Disclaimer: The recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
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