New Delhi: Hyundai IPO will see the company’s parent firm Hyundai Motor Company sell 14.2 crore equity shares from the India subsidiary through the public issue. After the stake sale process is completed, Hyundai Motor Company would still have 82.5% holding in the India subsidiary. In terms of number of shares, the parent firm would still be left with 67 crore equity shares in Hyundai Motors India.
Should You Apply In Hyundai IPO?
Aequitas Investments report as cited by the news agency ANI suggests that Hyundai IPO is overvalued. The findings reveal that there are two main reasons why the public issue process might not be a hit in India which are as follows:
- Headwinds faced by Global Automobile Industry
- signs of slowdown in India
According to ANI, one of the key issues flagged in the report is that despite contributing only 6.5% of Hyundai Motors India’s global revenue and 8 per cent of its overall profitability, the Indian unit is expected to be valued at approximately 42% of the parent company’s market capitalization upon listing. This makes Hyundai IPO overvalued.
Currently, the parent firm’s stock listed at the South Korea’s market gauges trade at a price-to-earnings (P/E) ratio of just 5x. Hyundai Motor Group, which includes both Hyundai and Kia, is the third-largest automaker globally. In 2023, the group sold 70.3 lakh vehicles worldwide.
Hyundai IPO Price Band
So far, it has not been revealed what would be Hyundai IPO Price Band. Hyundai Motors India is the second largest automobile manufacturer in India facing cut throat competition from Tata Motors. The South Korea based automobile juggernaut’s India unit had sold 37,973 units of passenger vehicles in September 2024, as reported by Fada. Currently, Hyundai Motors India boasts of 14.91% market share in India’s market. Hyundai IPO of Rs 25,000 crore is going to be the largest public issue the country has ever seen.
