Hyundai Motor India Limited has received approval from the Securities and Exchange Board of India (SEBI) for its initial public offering (IPO). The South Korean automaker submitted its Draft Red Herring Prospectus (DRHP) in June 2024.
According to a report by Fortune India, the official red herring prospectus will be filed this week, with the IPO expected to debut on Dalal Street before Diwali, specifically on Friday, November 1, 2024. This IPO is anticipated to be the largest in India to date, with estimates suggesting it could raise around $3 billion.
The market is buzzing with excitement as Hyundai solidifies its position as one of the strongest players in the Indian car market, consistently increasing its market share. Analysts expect Hyundai to achieve a higher valuation than its peers, such as Maruti Suzuki, which currently trades at a price-to-earnings (P/E) ratio of 23 for FY25.
“Strong demand is anticipated for the IPO, with robust liquidity in the market. However, there are concerns that this could lead to a potential drying up of liquidity in the secondary market. Additionally, the recent buzz in the grey market has slightly tapered off in the past couple of days,” noted Santosh Meena, Head of Research at Swastika Investmart Ltd.
As part of the IPO process, Hyundai Motor Company plans to sell 142 million shares out of a total of 812 million shares from its India subsidiary. The company aims for a valuation of $30 billion, utilizing the funds raised to expand its operations in India, the third-largest car market globally. Hyundai currently ranks as India’s second-best-selling automaker, following Maruti Suzuki.
