Hyundai Motor India Sets Price Band for ₹27,870-Crore IPO

9 Oct 2024 , 09:35 AM

Hyundai Motor India, the country’s second-largest car manufacturer, has announced a price band of ₹1,865 to ₹1,960 per share for its ₹27,870-crore IPO, set to debut on October 15.

At the upper price band, the Indian subsidiary of South Korea’s Hyundai Motor Company will be valued at ₹1.59 lakh crore. Post-issue, the parent company will retain an 82.5% stake in the Indian unit.

This IPO is solely an offer-for-sale of 14.2 crore equity shares by the promoter, Hyundai Motor Company, with no new issue component. Consequently, all proceeds (excluding offer expenses) will go to the parent firm. The primary goal is to list shares on Indian exchanges, marking the largest automobile IPO in India since Maruti Suzuki in 2003.

Investors can bid for a minimum of seven equity shares and in multiples of seven thereafter. Retail investors need to invest at least ₹13,720 for one lot of seven shares, with a maximum investment capped at ₹1,92,080 for 14 lots (98 shares) due to the ₹2 lakh limit for retail investors.

Institutional investors will have the opportunity to invest in the anchor book for a day on October 14, with the offer closing on October 17. The allocation will be split as follows: 50% for qualified institutional buyers, 15% for non-institutional investors, and 35% for retail investors. Employees will be offered up to 7,78,400 equity shares at a discount of ₹186 per share from the final issue price.

This IPO will be the largest in India since the Life Insurance Corporation of India’s ₹21,000-crore public issue in 2022.

Hyundai Motor India, following Maruti Suzuki, has a diverse portfolio of 13 passenger vehicle models, including sedans, hatchbacks, SUVs, and battery EVs. In the June 2024 quarter, the company sold 1.92 lakh vehicles, up from 1.83 lakh units year-on-year, and for fiscal 2024, total sales reached 7.77 lakh vehicles compared to 7.2 lakh the previous year.

Financially, Hyundai reported a net profit of ₹6,060 crore for the year ending March 2024, an increase of 28.7%, with revenue growing 15.8% to ₹69,829 crore over fiscal 2023. In the first quarter of FY25, revenue was ₹17,344.2 crore, a 4.3% increase, while net profit rose by 12.1% to ₹1,489.6 crore compared to the same period last year.

Kotak Mahindra Capital Company, Citigroup Global Markets India, HSBC Securities and Capital Markets (India), JP Morgan India, and Morgan Stanley India Company are serving as the merchant bankers for the IPO.