Hyundai Motor India Ltd. is making headlines as it embarks on its much-anticipated initial public offering (IPO), which opened for subscription on October 15, 2024. As of today, October 16, the IPO has garnered significant attention, albeit with a slower start than expected.
Main Points
Overview of the IPO
Hyundai Motor India’s IPO is a monumental event in the Indian stock market, aiming to raise approximately ₹27,870 crore. This IPO is entirely an offer for sale (OFS), where Hyundai’s parent company, Hyundai Motor Global, is selling up to 14.2 crore shares. The price band for the shares has been set between ₹1,865 and ₹1,960 per share. Investors can apply in lots of seven shares, with the IPO open until October 17.
Subscription Status on Day 2
As of today, the subscription status shows that the IPO has received a total of 20% subscription by mid-morning. This includes:
- Retail Individual Investors (RIIs): 29%
- Non-Institutional Investors (NIIs): 15%
- Qualified Institutional Buyers (QIBs): 5%
On Day 1, the IPO had only managed an 18% subscription rate, which raised concerns among investors about the overall demand for Hyundai’s shares.
Detailed Subscription Figures
The total number of bids received so far stands at nearly 1.98 crore against the total shares available for subscription of 9.97 crore. The retail segment showed strong interest compared to institutional investors, who have been more cautious in their bidding.
Grey Market Premium (GMP)
The grey market premium (GMP) for Hyundai Motor India’s shares is currently at ₹63, indicating a potential listing gain of about 3.21% upon its debut on stock exchanges. This premium reflects market sentiment and expectations regarding the company’s performance post-listing.
Investor Sentiment and Market Analysis
Despite the initial sluggish response, analysts believe that Hyundai’s strong market position and future growth prospects could attract more investors as the subscription period progresses. The company aims to enhance its manufacturing capabilities by taking over a former General Motors factory in Maharashtra, with plans to produce around 1 million cars annually by March 2026.
Market experts suggest that while the IPO is priced at a premium compared to competitors like Maruti Suzuki, it reflects Hyundai’s robust operational margins and growth potential in India’s expanding automotive sector.
Key Dates and Future Outlook
- IPO Opening Date: October 15, 2024
- IPO Closing Date: October 17, 2024
- Allotment Date: October 18, 2024
- Listing Date: October 22, 2024
Hyundai’s management has emphasized its commitment to strengthening its brand presence in India. “India is the most exciting market in the world,” said Unsoo Kim, President of Hyundai Motor India. The company aims to leverage this IPO to further localize operations and enhance governance practices.
Hyundai Motor India’s IPO represents a significant milestone in the Indian automotive industry as it seeks to capitalize on growing demand in one of the world’s largest car markets. While initial subscription rates have been modest, investor sentiment may shift as more information becomes available and as potential listing gains become clearer.
