Hyundai Motor Shares Debut below Issue Price

Hyundai Motor made a lukewarm debut on the stock exchanges on Tuesday, October 22. On the National Stock Exchange (NSE), its shares were listed at Rs. 1,934, a 1.3% discount from the issue price of Rs. 1,960. Similarly, on the Bombay Stock Exchange (BSE), the shares were listed atRs. 1,931, reflecting a 1.5% drop.

India’s Largest IPO

This IPO is the biggest public offering in India's history, valued at Rs. 27,870.16 crore. The public subscription period for the IPO was open from October 15 to October 17. The price range for the shares was set between Rs.1,865 and Rs.1,960 per share.

Though the IPO attracted decent interest, it did not meet expectations, with bids totaling 2.37 times the available shares. Out of 9.89 crore shares on offer, the IPO received bids for 23.63 crore shares.

Investor Response

Retail investors and non-institutional investors (NIIs) did not fully subscribe to the IPO. Retail subscriptions reached only 0.50 times the available shares, while the NII segment saw a subscription of 0.6 times. However, the Qualified Institutional Buyers (QIB) category was fully subscribed, receiving 6.97 times the available shares.

Details of the IPO

Hyundai Motor's IPO was entirely an Offer for Sale (OFS), comprising 14.22 crore shares, meaning there was no fresh issue of shares. After the IPO, the promoter's stake in the company will decrease to 82.5%. On October 14, 2024, the company secured Rs.8,315.28 crore from anchor investors.

Retail investors could buy a minimum of seven shares per lot, with an investment starting at Rs.13,720. However, the company itself will not receive any proceeds from the sale; the entire amount will go to the Promoter Selling Shareholder, with taxes and expenses deducted.

The IPO included a special allotment of 778,400 shares for employees, available at a discounted rate of Rs.1,774, which is ₹186 less than the issue price.

About Hyundai Motor India

Founded in May 1996, Hyundai Motor India Limited is a subsidiary of the Hyundai Motor Group, which ranks as the third-largest global manufacturer of passenger vehicles. The company is known for producing technologically advanced and feature-packed four-wheelers, along with key components such as engines and transmissions.

With a vast network of 1,366 sales points and 1,550 service centers across India, Hyundai Motor India has sold nearly 12 million passenger vehicles, both in the domestic market and through exports, as of March 31, 2024.

Between the financial years ending March 31, 2023, and March 31, 2024, the company’s revenue rose by 16%, and its profit after tax increased by 29%.

Hyundai Motor's IPO debut may have been below expectations, but it remains one of the largest public offerings in India's history. The company's solid foundation, extensive market presence, and innovative automotive solutions make it a key player in the industry. While the IPO saw mixed responses from various investor segments, Hyundai Motor India’s long-term growth and potential remain promising, particularly with its strong market position and continued expansion in the passenger vehicle sector.

Also read: Indian Stock Market Extends Losses: Weak Earnings and Geopolitical Risks in Focus

Disclaimer

This article is intended for informational purposes only and should not be considered as financial or investment advice. Investing in the stock market carries inherent risks, and readers are encouraged to conduct thorough research or consult with a certified financial advisor before making any investment decisions. The information provided is accurate to the best of our knowledge at the time of writing but may be subject to change.