Hyundai Motor India Files RHP for Record ₹3 Billion IPO Launch

Hyundai Motor India, a subsidiary of South Korea’s Hyundai Motor Company, has submitted a red herring prospectus to the Registrar of Companies on October 8. The Hyundai IPO is set to launch on Dalal Street on October 15. This IPO will consist entirely of an offer-for-sale, with no new shares being issued.

The promoter, Hyundai Motor Company, plans to sell 14.2 crore equity shares in this offer, according to the RHP. The price range for the shares will be announced on October 9.

The ₹3 billion public issue will be available for institutional investors (anchor book) for one day on October 14. The subscription period for the IPO will close on October 17.

Out of the total public issue size (excluding shares reserved for employees), half has been allocated for qualified institutional buyers, with up to 60% of those shares set aside for anchor investors. Additionally, 15% of the shares are reserved for non-institutional investors, while the remaining 35% are for retail investors.

Hyundai Motor India has set aside up to 7,78,400 equity shares for its employees. The company has been the second-largest car manufacturer in the Indian passenger vehicle market since FY09, following Maruti Suzuki, and has been the second-largest exporter of passenger vehicles in India from April 2021 to June 2024.

With an expected issue size of ₹3 billion, Hyundai IPO is likely to have the largest IPO in India, surpassing the previous record of ₹21,000 crore (₹2.7 billion) raised by the Life Insurance Corporation of India in 2022. After the IPO, Hyundai Motor Company will own 82.5% of Hyundai Motor India, as stated in the RHP. Hyundai IPO is anticipated to attract significant investor interest and will be the largest listing in the Indian automobile sector since Maruti Suzuki’s debut in 2003.

Divam Sharma, co-founder of Green Portfolio, noted that the pre-IPO market for companies like Hyundai Motor India, Swiggy, and NTPC Green Energy is experiencing high demand from seasoned investors. He believes strong investor sentiment will continue for upcoming IPOs.

Financially, Hyundai Motor India has performed well, with a net profit increase of 12.1% year-on-year to ₹1,489.6 crore for the quarter ending June 2024. The company reported an EBITDA (earnings before interest, tax, depreciation, and amortization) of ₹2,340.3 crore for the June quarter, up 17.2%, and the EBITDA margin rose by 148 basis points to 13.5% compared to the same period last year.

In the first quarter of fiscal year 2025, revenue was ₹17,344.2 crore, a 4.3% increase from ₹16,623.5 crore in the same period last year. For fiscal year 2024, net profit rose by 28.7% to ₹6,060 crore, and revenue grew by 15.8% to ₹69,829 crore. EBITDA for FY24 increased by 21% to ₹9,132.6 crore, with the margin rising by 58 basis points to 13.08%.

Hyundai Motor India will determine the basis for allotting shares in its IPO by October 18, and successful investors will have their shares credited to their demat accounts by October 21. Trading of Hyundai Motor India shares is set to begin on the BSE and NSE on October 22.

As the Hyundai Motor stock listing nears, the Hyundai Motor Share Price will set the tone for early trading and potential long-term gains for investors

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.