Hyundai Motor India’s Historic IPO Launch
Hyundai Motor India, a leading player in India’s automotive sector, is set to make a significant mark on the stock market with its upcoming initial public offering (IPO). Scheduled for launch on October 14, the IPO is projected to raise a staggering ₹25,000 crore, making it the largest IPO in Indian history. This monumental offering is expected to eclipse the previous record set by the Life Insurance Corporation (LIC), which had a public offering of ₹21,000 crore.
Details of the IPO
The IPO will consist solely of an offer-for-sale (OFS) of approximately 142,194,700 equity shares, which will be sold by the promoter, Hyundai Motor Company. Notably, there will be no fresh issue component, which means that Hyundai Motor India will not receive any proceeds directly from this IPO. The company has filed its draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (Sebi) as part of the IPO preparatory process, which received regulatory approval on September 24.
Funding and Stake Dilution Plans
Through this IPO, Hyundai aims to raise around $3 billion (₹25,000 crore) and may dilute a 15% to 20% stake in the company. This strategic move is anticipated to enhance the company’s visibility and brand image, while also providing a liquid public market for its shares.
A Historic Moment for the Automotive Industry
Hyundai Motor India holds the distinction of being the second-largest carmaker in India, following Maruti Suzuki. With this upcoming IPO, Hyundai will become the first automaker to offer shares to the public in nearly two decades. Maruti Suzuki was last listed in 2003, marking a significant shift in the Indian automotive landscape.
Financial Performance Overview
As of the nine months ending December 31, 2023, Hyundai Motor India reported impressive financials, with revenue from operations reaching ₹32,488.34 crore and a net profit of ₹4,382.87 crore, reflecting a profit margin of 13.5%. These figures underscore Hyundai’s robust performance in the competitive automotive sector.
Management and Advisory Team
The book-running lead managers for this high-profile IPO include prestigious firms such as Kotak Mahindra Capital Company Limited, Citigroup Global Markets India Private Limited, HSBC Securities & Capital Markets Pvt Ltd, JP Morgan India Private Limited, and Morgan Stanley India Company Pvt Ltd. Additionally, Kfin Technologies Limited has been appointed as the key issue registrar to ensure a smooth process.
Conclusion
Hyundai Motor India’s impending IPO not only signifies the company’s growth trajectory but also represents a crucial evolution in the Indian stock market. As investors look forward to this historic offering, it is evident that Hyundai is poised to make a significant impact on India’s automotive industry and financial landscape.
