Hyundai IPO: Price, Date, GMP, and Should You Go For It? All the Details 2024

Hyundai IPO: Price, Date, GMP, and Should You Go For It? All the Details 2024

Undoubtedly, Hyundai Motor India Limited is one of the most awaited IPOs of 2024. It is a subsidiary of South Korea’s Hyundai Motor Company, and hence it will be hitting the Indian stock market with its Initial Public Offering. In fact, the exposure through the IPO would be another golden opportunity for the investors in getting acquainted with one of the leading automobile manufacturers which have shaped the Indian car market.

Hyundai-which has an existing track record of innovation and a robust sales performance-set to attract enormous interest among institutional investors as well as retail participants, thus a rich IPO. Here are the Hyundai IPO dates and price band.

Hyundai IPO Dates and Price Band

The Hyundai Motor India IPO will open for public subscription on October 16, 2024, and will close on October 18, 2024. This gives investors a three-day window to apply for the IPO.

The IPO issue price band has been set between ₹ 480 to ₹500 per equity share. This is essentially the valuation of the company as a result of its financial performances, prospects of growth, and the market conditions. The final offer price will, therefore depend on the subscription process, at which retail investors shall be able to invest in this price range.

IPO Size and Structure

The Hyundai IPO is estimated at ₹5,000 crore and will comprise a fresh issue and an offer-for-sale (OFS) by existing shareholders. Hyundai Motor India will use the proceeds of the fresh issue to expand its operations, pay off debt, and invest in future growth, particularly electric and hybrid technologies.

OFS allows some existing shareholders to sell part of their holdings thereby giving liquidity to the promoters and early investors. The actual size of fresh issue and OFS is likely to come out in the final prospectus.

GMP (Grey Market Premium) of Hyundai IPO

Grey Market Premium or GMP is a gray market indicator. It basically is a reflective of the market sentiment as well as the listing price of an IPO. So far, the GMP of Hyundai IPO is in the range of Rs 40 to 50. This indicates that there would be a moderate premium over its issue price and thus, it has huge demand for the Hyundai shares in the gray market.

However, while GMP gives an early indication of listing performance, the investors should focus on the company’s fundamentals and long-term prospects rather than short-term market speculation.

About the Company: Hyundai Motor India Business Description

Hyundai Motor India is one of the largest automobile manufacturing companies in India, with an immense market share in the car segment of passenger vehicles. Major popular marques under the brand include compact hatchbacks, luxury SUVs, and some of the top-selling cars, including the Hyundai i20, Creta, Verna, and the latest electric car, Ioniq 5.

Hyundai enjoys significant strength in distribution in India and is an extremely customer-friendly company, thereby building the required trust with the brand. The company has also been expanding its footprint in the electric vehicle segment, which would be a substantial future growth driver going ahead as the country advances toward greener mobility solutions.

Key Strengths

Diversified Product Portfolio: Hyundai offers a wide range of vehicles catering to the different customer segments, starting from budget-conscious buyers to premium car enthusiasts.

Strong Brand Loyalty: For years, Hyundai has established a loyal customer base in India due to its focus on quality, innovation, and after-sales services.

EV and Hybrid Ventures: Hyundai has already made significant investments in electric vehicle technology to be well-positioned for opportunities in the burgeoning demand for environment-friendly vehicles in India.

Growth Strategy and Expansion Plans for Hyundai Motor India

Hyundai Motor India aims at three big growth areas: electric vehicle segment, hybrid technology, and exports. The long-term vision of the company jells well with the policy push from the Indian government toward green and sustainable transportation solutions.

Hyundai has heavily invested into its electric vehicle lineup. Newly launched Hyundai Ioniq 5 and EV models, which the company is likely to launch this year, would be driving growth forward, as demand for electric cars is gaining pace in India. The focus on reducing carbon emissions and building out the infrastructure of electric vehicles is also aimed at supporting Hyundai’s strategy.

Hybrid Cars: According to reports, Hyundai is said to be working on launching hybrid cars in the Indian market. These cars are going to prove a rescue for those who want to see an end to fuel consumption without increasing carbon footprint.

Export Market: Hyundai India is no longer just focusing on the Indian market but also exports its automobile to several countries in the world. The company is looking forward to exporting more automobiles from India and increasing export numbers, mainly to the region of the Middle East and Africa by using India as an export hub.

Hyundai Motor India Performance

Before investing in the company, there is a need to analyze its financial health. Hyundai Motor India has always recorded good financial performance in the recent past because of its good sales records and streamlined working patterns.

Revenue: In FY 2024, Hyundai produced revenue of ₹60,000 crores through robust sales in both domestic as well as international markets.

Profitability: Hyundai reported PAT for the same quarter at ₹4,200 crore, thus showing that it is able to sustain its profitability despite other challenges like increasing input costs and disturbances in the supply chain.

EBITDA Margin: The company has been maintaining a constant EBITDA margin at about 15%. That reflects Hyundai’s ability to manage operational costs and deliver value for shareholders.

Risks and Concerns for Investors

Hyundai Motor India is one of the key drivers in the automobile sector; however, potential investors should also know all the risks are involved:

Market Competition: Indian automobile markets are generally high, major competitors in the industry are Maruti Suzuki, Tata Motors, and Mahindra & Mahindra that immensely competes with Hyundai Motor India.

Rising Input Costs: Steel prices will rise, and a semiconductor shortage may impact Hyundai’s profit margins because of higher input costs.

Regulatory Changes: As the Indian government is trying to enhance stringent norms for emission and is also providing incentives for purchasing EV, Hyundai has invested much in the area of R&D. This helps it to remain in the same position.

Should You Subscribe to the Hyundai IPO?

Hyundai’s IPO will be good for investment purpose for both short-term and long-term investors as the company is enduring with a consistent brand value, which has promising growth prospects, particularly in electric vehicles market.

For Short-term Investors: With a healthy GMP and with market sentiment positive, Hyundai IPO may fetch listing gains for the eager short-term investors.

Hyundai is a bet for the sustainable growth of the auto sector, given that it is presently shifting its strategic focus towards electric vehicles and hybrids with further extension into exports. With such stable financial history and market position dominance, long-term investors may wish to hold onto Hyundai shares for future gains.

Conclusion:

Hyundai Motor India’s IPO is coming at a very important time, when the Indian automobile market is crossing over a period of transition, especially electric vehicles. And through innovation, its robust product portfolio, and expansion in the EV space, the company is very well poised for growth.

It is important to note that Hyundai’s financial performance, growth prospects, and risks all form part of the investment decision-making process. Since the GMP indicates a positive market sentiment, this price range of ₹480 to ₹500 per share would surely garner considerable interest among investors in this IPO. A short-term gain or long-term growth-oriented investor would not mind investing in one of India’s leading automobile manufacturers through this IPO.
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Disclaimer:

All above recommendations are of the market analysts. Neither the author, nor the brokerage firm, nor Stockstoday.in will be responsible for any loss arising out of any such decision taken based upon this information. All users are cautioned to take their own expert advice prior to making any investment decision.

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