Hyundai India plans to launch IPO this Diwali
Hyundai is considering taking its Indian subsidiary, Hyundai Motor India (HMIL), public in what could be India's largest initial public offering (IPO) ever. It plans to launch IPO around Diwali i.e. between September-November. The South Korean carmaker is exploring this option to capitalize on India's thriving IPO market, nearly 30 years after HMIL's inception. In 2023, HMIL was the second-largest passenger vehicle seller in India, trailing only Maruti Suzuki.
The company is valued between $22-28 billion
Last week, top global investment banks, such as Goldman Sachs, Citi, Morgan Stanley, JP Morgan, Bank of America, HSBC, Deutsche Bank, and UBS, met in Seoul to present IPO proposals to Hyundai's leadership. Bankers valued the company between $22-28 billion and suggested a 15-20% dilution to raise $3.3-5.6 billion. Hyundai is yet to make an official statement regarding its public debut in India.
Diwali favored time for Hyundai IPO but factors matter
The initial plan envisions a Diwali listing for HMIL. However, these are initial discussions, and the final details will depend on further talks and external factors such as the strength of Indian capital markets and various macroeconomic factors. "But the work has begun at the headquarters. This is a strategic market and Hyundai wants to deepen the relationship," the Economic Times reported citing a source.
Hyundai India's performance and market share
In 2023, HMIL sold 602,000 units in India, an 8.9% increase from the previous year, and gained 13 basis points to enjoy a market share of 14.7%. The company recorded its best operating performance and sales in 2023 due to the rise in premium vehicles' share and healthy capacity utilization. At the upper band of $28 billion, HMIL would be valued higher than Mahindra, Adani Power, and Bajaj Auto.
Hyundai's focus on EVs
Hyundai leads Maruti Suzuki in the EV market, as the market leader has yet to introduce an EV in its product lineup. "To cater to the growing demand and shift toward EVs, Hyundai India is in the process of touching 8.5 lakh units in production capacity and is also accelerating its EV plan to participate in this fast-growing space," the company said in a regulatory filing. It has committed to launching five EV models in India by 2030.
