Hyundai Motor India Ltd (HMIL), the Indian arm of South Korean car manufacturer Hyundai, on October 11 claimed its going public (IPO) will certainly be opened up for public membership on Tuesday, October 15. The Rs 27,870.2-Crore IPO, which will certainly be shut on October 17, is a full offer-for-sale (OFS) where the business’s South Korean moms and dad will certainly be thinning down several of the risk. Should you use? Here’s whatever you require to understand:
Though the IPO will certainly stay opened up for public in between October 15 and October 17, support financiers can send quotes on October 14. The share allocation will certainly occur on October 18, while Hyundai Motor India’s shares will certainly be detailed on BSE and NSE on October 22.
Hyundai Motor India IPO: Price Band and Lot Size
The rate band of the much-awaited IPO has actually been dealt with in the variety of Rs 1,865 to Rs 1,960 per share.
Investors can bid for the IPO for a minimum of 7 equity shares and in multiples of 7 equity shares afterwards.
Hyundai Motor India IPO GMP Today
According to market viewers, unpublished shares of Hyundai Motor India Ltd are trading Rs 100 greater in the grey market than its problem rate. The Rs 100 grey market costs or GMP implies the grey market is anticipating a 5.10 percent listing gain from the general public problem. The GMP is based upon market beliefs and maintains transforming.
‘Grey market premium’ shows financiers’ preparedness to pay greater than the problem rate.
Hyundai Motor India IPO: Analysts’ Recommendations
This IPO marks a considerable turning point for the Indian car market, as it is the initial car manufacturer’s first share sale in over 20 years, adhering to Japanese car manufacturer Maruti Suzuki’s listing in 2003.
Giving a ‘Buy’ referral, Bajaj Broking in its IPO note claimed, “For the last three fiscals, the company has reported an average EPS (earning per share) of Rs 62.56, and an average RoNW (return on net worth) of 39.11 per cent. The issue is priced at a P/BV (price-to-book value) of 13.11 based on its NAV (net asset value) of Rs 149.52 as of June 30, 2024, as well as post-IPO equity capital since this is a secondary issue.”
If one associates FY25 annualised extremely profits to its post-IPO totally watered down paidup equity funding, after that the asking rate goes to a price-to-earning (P/E) of 26.73, and based upon FY24 profits, the P/E stands at 26.28, it claimed.
“The issue relatively appears fully priced, but the company is poised for bright prospects post completion of its ongoing expansions,” claimed Bajaj Broking.
Hyundai Motor India reported earnings after tax obligation (RUB) margins of 6.05 percent (FY22), 7.67 percent (FY23), 8.50% (FY24), 8.48% (Q1-FY25), and RoCE (return of funding utilized) margins of 20.37 percent, 28.75 percent, 62.90 percent, 13.69 percent for the referred durations, specifically.
Another broker agent Master Capital Services in its IPO note claimed, “Hyundai’s IPO offers potential value growth by expanding investment prospects in the underdeveloped Indian auto market.”
Saji John, elderly research study expert at Geojit Financial Services, claimed, “Hyundai’s impressive financial performance and premium product mix, especially in the SUV segment, could alter the competitive landscape in the listed space. This could force other automakers to innovate and improve their offerings to build investors’ confidence. Investors might reallocate their portfolios based on Hyundai’s perceived growth potential and valuation, which could put downward pressure on its competitors’ share price.”
Hyundai’s focus on advancement, specifically in the EV market, tactically positions it to get a bigger market share and command greater costs. With the expanding customer choice for EVs, Hyundai’s cutting-edge and affordable versions are most likely to attract even more purchasers. The business’s durable brand name picture and dedicated client base, specifically in the SUV and costs auto markets, can even more lessen Maruti’s market share and sales. Additionally, Hyundai’s solid track record for high quality and safety and security is a considerable consider drawing in clients, John included.
“Hyundai’s IPO being the first major auto IPO in India in over two decades could attract significant global investor interest. This influx of foreign investment could further enhance the sector’s valuation. The company’s portfolio expansion and manufacturing capabilities highlight the growth potential and investment in the automotive market. The increased competition and innovation driven by Hyundai’s enhanced financial strength post-IPO could push other automakers to reassess their growth potential and market positioning, positively re-rating the sector. Conversely if the listing has been perceived as overvalued then it can negatively impact,” John claimed.
Mirae Asset Capital Markets in its note claimed, “On financial metrics, HMIL exhibits superior operating margins relative to its closest competitor. At the upper price band of INR 1,960, HMIL is priced at a PE of 26.3x FY24 EPS, in comparison to Maruti Suzuki Ltd., which trades at 30.8x FY24 EPS.”
Hyundai Motor India IPO: More Details
Hyundai Motor India started procedures in India in 1996 and presently markets 13 versions throughout sections.
In its draft documents, Hyundai Motor India claimed, “Further, our Company expects that listing of the Equity Shares will enhance our visibility and brand image and provide liquidity and a public market for the Equity Shares in India.”
Hyundai established its India procedures in 1996, starting with the Santro hatchback, when its most marketed auto. Hyundai holds India’s no. 2 carmaker place, can be found in behindMaruti Suzuki It presently has an approximately 15% share in the nation’s affordable auto market. It marketed 614,721 vehicles in India and exported 163,155 devices in the year to March 2024
Hyundai has one manufacturing facility beyond Chennai in southerly Tamil Nadu state, additionally referred to as the Detroit ofAsia The manufacturing facility has a capability of 824,000 devices each year and is going for an exercise price of 94 percent, leaving little space for development that would certainly assist take on Maruti Suzuki.
Hyundai intends to get to manufacturing of regarding 1 million devices a year with the purchase of a previous General Motors plant in western Maharashtra state. The plant is anticipated to begin procedures just by the 2nd fifty percent of the year to March 2026.
Hyundai has 1,377 suppliers throughoutIndia In India, the carmaker markets 13 versions, with the ‘Creta’ and ‘Venue’ sporting activity energy lorries along with the ‘Grand i10 Nios’ hatchback amongst its top-selling versions.
Hyundai’s existing manufacturing facility is additionally a crucial export center, which makes vehicles that are delivered to South Africa, the Middle East along with Latin America.
Citi, HSBC Securities, JP Morgan, Kotak Mahindra Capital and Morgan Stanley are the financial investment financial institutions recommending on the purchase and law practice Shardul Amarchand Mangaldas is the business advice. Cyril Amarchand Mangaldas is the financial institutions’ advice and Latham and Watkins is functioning as the worldwide advice.
