Hyundai India Launches its $3.3 Billion IPO, marking the Country's Largest Sale

Hyundai India will begin accepting orders for its US$3.3 billion (RM14.2 billion) initial public offering (IPO) in Mumbai on Monday, according to regulatory filings. This will be India's largest-ever share offering and the second biggest IPO globally in 2024. India's capital markets remain robust, with 260 companies raising over US$9 billion so far this year, surpassing the US$7.42 billion total raised in 2023, according to LSEG data.

Hyundai will not issue new shares in the IPO, in which its South Korean parent will sell up to 17.5% of its stake in the wholly owned unit that will be valued at up to US$19 billion. At that size, Hyundai India will make up about 40% of its parent company Hyundai Motor's market capitalisation. There will be 142,194,700 shares on offer in a price band of 1,865 to 1,960 rupees, according to the filings, and the deal will be the first time Hyundai is listed outside of its South Korean home market.

Institutions can bid for the stock from Monday, while retail and other investors can place orders on Tuesday and Wednesday. The stock will begin trading in Mumbai on Oct 22, the regulatory filings showed. Analysts said Hyundai Motor is likely to expand its production in India, potentially including hybrids and electric vehicles. This would help the South Korean automaker strengthen its position in the Indian market as the country focuses on environmentally friendly vehicles.

"With the funds raised by the IPO, Hyundai Motor would secure a sizeable investment capacity to close the market share gap with India's No 1 player Maruti Suzuki, as the South Korea automaker would likely invest to expand its production in India", said Shin Yoon-chul, an analyst at Kiwoom Securities. He added that the IPO seems timely as the auto sector has been leading the Indian stock market in terms of performance.

Hyundai India's IPO will be the largest ever in India if successful, eclipsing the previous record of Life Insurance Corporation of India's 2022 deal when it raised US$2.5 billion. The Hyundai India IPO will be the second-largest globally this year in terms of funds raised, following Lineage Inc.'s US$5.1 billion IPO in the U.S. in July. As India’s second-largest automaker, after Maruti, Hyundai aims to capture more market share from domestic competitors by expanding its SUV lineup. The company also plans to launch its first India-made electric vehicle early next year, with at least two new gasoline-powered models tailored for the market set to debut by 2026.

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