Hyundai Motor India’s unit has officially filed preliminary papers with SEBI for a ₹25,000 crore public offering, which could potentially be the largest IPO in the country’s history. The automaker is the first in 20 years to file for an IPO, following in the footsteps of Maruti Suzuki’s 2003 public listing. The upcoming IPO is expected to value the company at around ₹1.5 lakh crore.

Key Highlights of the Hyundai IPO:

SEBI Approval and IPO Type: Hyundai Motor India’s division has requested regulatory approval from SEBI for listing its shares on the Mumbai Stock Exchange. This offering is notable for being the first by an automaker in two decades. The South Korean parent company plans to sell up to 17.5% of its stake in Hyundai Motor India through the “offer for sale” (OFS) method. No new shares will be issued; instead, existing shareholders will sell their stake to retail and institutional investors.

  • Issue Size: According to the SEBI filing, Hyundai plans to sell up to 14.2 crore equity shares out of its total 81.22 crore shares in the IPO.
  • Hyundai IPO Price Band and Valuation: While the draft prospectus does not detail the pricing, media reports estimate that Hyundai aims to raise between $2.5 billion and $3 billion. The company’s valuation is expected to reach up to $30 billion, making it one of India’s largest IPOs, second only to the ₹2.5 billion IPO by Life Insurance Corporation of India in 2022.
  • Objective of the IPO: The primary goals of Hyundai Motor India’s IPO are to increase the company’s visibility and brand recognition in the Indian market, unlock value for Indian operations, and create liquidity for shareholders. The Hyundai IPO will help Hyundai close the valuation gap between itself and its global and Asian competitors.

Reservation and Allocation:

  • Up to 50% of the issued shares will be reserved for qualified institutional buyers (QIBs).
  • At least 35% will be allocated to retail individual investors (RIIs).
  • A minimum of 15% will be set aside for non-institutional investors (NIIs).

Lead Managers and Registrar: The IPO will be managed by top financial institutions including Kotak Mahindra Capital Company, Citigroup Global Markets India, HSBC Securities and Capital Markets (India), JPMorgan India, and Morgan Stanley India. KFin Technologies will serve as the registrar for the issue.

Financial Performance and Hyundai’s Growth in India

Hyundai Motor India is the second-largest car manufacturer in the country, trailing only Maruti Suzuki. In FY23, Hyundai reported revenues of ₹60,000 crore, with profits of ₹4,653 crore, making it the most profitable non-listed automaker in India. Over its 28 years in India, Hyundai has gained immense popularity with models like the Santro and Creta and is now shifting focus towards electric vehicles (EVs), charging infrastructure, and battery pack assembly.

Expansion Plans

Looking ahead, Hyundai aims to increase its annual production capacity in India to one million units by 2025, focusing on affordable locally manufactured EVs. The company has invested $5 billion in its Indian operations over the years and has committed an additional $4 billion for further growth over the next decade.

Conclusion

Hyundai follows in the footsteps of automakers like Maruti Suzuki, Mahindra & Mahindra, and Tata Motors, which have already raised funds through the capital markets. Ola, the ride-hailing company, has also received SEBI approval for its upcoming IPO.