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Hyundai India targets $3 billion IPO, eyeing record valuation

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Hyundai Motor India Limited (HMIL), the second-largest carmaker in India after Maruti Suzuki in FY24 based on passenger sales volumes, is gearing up for a monumental IPO. The company has invested $5 billion in its two manufacturing units in India, which remains its third-largest revenue market. Hyundai expects the IPO to enhance its visibility and brand image in India. Additionally, the listing will provide liquidity and create a public market for its shares.

Hyundai Motor India’s arm is set to file draft papers with SEBI, targeting to raise $3 billion through an initial public offering (IPO) at a valuation between $18 billion to $20 billion. The South Korean parent company plans to sell up to 142 million shares, representing a 17.5% stake in its Indian subsidiary through the “offer for sale” (OFS) route. If successful, this will surpass the previous record set by LIC’s $2.7 billion IPO in 2022.

The company ended FY23 with revenue of Rs 60,000 crore and profits of Rs 4,653 crore, the highest among non-listed car manufacturers in India. Hyundai Motor India is a major player in the Indian automotive market, contributing around 13% to Hyundai’s global sales in 2023. Popular models include the i20, Verna, Creta, Aura, and Tucson. Citi, HSBC Securities, JP Morgan, Kotak Mahindra Capital, and Morgan Stanley are advising on the transaction. HMIL achieved its highest-ever domestic sales in 2023, crossing the six-lakh mark.

The IPO is expected to draw significant attention from investors, given Hyundai’s strong performance and market position. This IPO could redefine the Indian automotive market landscape, providing Hyundai with the capital to expand and innovate further.

 

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