Hyundai India's $3.3 Billion IPO: Country's Largest Share Sale
Sunday, Oct 13, 2024 9:41 pm ET
1min read Hyundai India, a subsidiary of the Korea-based Hyundai Group, has announced its intention to launch a $3.3 billion initial public offering (IPO), the largest in the country's history. The IPO, expected to open for subscription on October 15, 2024, will consist of an offer for sale of 142,194,700 equity shares with a face value of ₹10 each. The price band for the IPO is yet to be announced.
Hyundai India's IPO is a significant milestone for the company, which has been a major player in the Indian automobile market since its inception in 1996. The company specializes in manufacturing and selling a wide range of four-wheeler passenger vehicles, including sedans, hatchbacks, SUVs, and electric vehicles (EVs). Additionally, Hyundai produces key automotive parts such as transmissions and engines.
The company's financial performance has been robust, with revenue increasing by 16% and profit after tax (PAT) rising by 29% between the financial year ending with March 31, 2024, and March 31, 2023. As of December 31, 2023, Hyundai Motor India boasted 1,366 sales outlets and 1,550 service centers across various cities and towns in India.
Hyundai India's IPO comes at a time when the Indian automobile market is witnessing significant growth. The country is the third-largest car market globally, trailing only China and the US. With electric vehicles gaining popularity, experts predict India will have 2.5 million EVs on the roads by 2025, making it the third-largest EV market as well. Automakers are closely watching these developments and are eager to jump on this trend.
Hyundai India's IPO is expected to raise ₹25,000 crores, potentially breaking previous IPO records held by LIC and PayTM. However, the company's decision to pursue an IPO in the Indian market is not without risks. Kia Corporation and Kia India Pvt Ltd, also owned by Hyundai, operate in a similar domain, which could lead to conflicts of interest. Additionally, centralized operations at the Chennai plant and the upcoming Talegaon plant could impact operations and financial health in case of disruptions.
Hyundai India's IPO is a testament to the company's strong financial performance and its commitment to the Indian market. The IPO will provide an opportunity for investors to participate in the growth story of one of India's leading automobile manufacturers. However, investors should carefully evaluate the risks and challenges associated with the IPO before making an investment decision.
Hyundai India's IPO is a significant milestone for the company, which has been a major player in the Indian automobile market since its inception in 1996. The company specializes in manufacturing and selling a wide range of four-wheeler passenger vehicles, including sedans, hatchbacks, SUVs, and electric vehicles (EVs). Additionally, Hyundai produces key automotive parts such as transmissions and engines.
The company's financial performance has been robust, with revenue increasing by 16% and profit after tax (PAT) rising by 29% between the financial year ending with March 31, 2024, and March 31, 2023. As of December 31, 2023, Hyundai Motor India boasted 1,366 sales outlets and 1,550 service centers across various cities and towns in India.
Hyundai India's IPO comes at a time when the Indian automobile market is witnessing significant growth. The country is the third-largest car market globally, trailing only China and the US. With electric vehicles gaining popularity, experts predict India will have 2.5 million EVs on the roads by 2025, making it the third-largest EV market as well. Automakers are closely watching these developments and are eager to jump on this trend.
Hyundai India's IPO is expected to raise ₹25,000 crores, potentially breaking previous IPO records held by LIC and PayTM. However, the company's decision to pursue an IPO in the Indian market is not without risks. Kia Corporation and Kia India Pvt Ltd, also owned by Hyundai, operate in a similar domain, which could lead to conflicts of interest. Additionally, centralized operations at the Chennai plant and the upcoming Talegaon plant could impact operations and financial health in case of disruptions.
Hyundai India's IPO is a testament to the company's strong financial performance and its commitment to the Indian market. The IPO will provide an opportunity for investors to participate in the growth story of one of India's leading automobile manufacturers. However, investors should carefully evaluate the risks and challenges associated with the IPO before making an investment decision.