Hyundai Motor India made a significant market debut with an IPO that raised ₹27,870 crore, marking the largest IPO in Indian history. Despite the overwhelming interest from institutional investors, the stock’s performance on the first day was underwhelming, with shares falling by over 3% in early trading.
Hyundai Motor India’s IPO Listing Overview
Hyundai Motor India Shares Slip Over 3% Post Listing
October 22, 2024, 12:06 PM
Shares of Hyundai Motor India began trading on the NSE at ₹1,934 and on the BSE at ₹1,931, a 1.3% discount to its issue price of ₹1,960. Global brokerage firm Macquarie has initiated coverage with an Outperform rating.
Hyundai Motor India Share Price: Decline Continues
October 22, 2024, 11:53 AM
By midday, Hyundai shares were trading at ₹1,891.70 on the NSE, marking a 2.19% decrease. On the BSE, the stock stood at ₹1,881.70.
- Today’s High (NSE): ₹1,970
- Today’s Low (NSE): ₹1,844.65
- Current Trading Price (NSE): ₹1,891.70
- Current Trading Price (BSE): ₹1,881.70
Hyundai Motor India: Shares Continue to Fall
October 22, 2024, 11:48 AM
Hyundai Motor India’s shares dropped by over 3% to ₹1,873.10 on the NSE, reflecting a weak market sentiment post-listing.
October 22, 2024, 11:24 AM
Bloomberg reports that Hyundai Motor India’s shares slipped almost 6% in their early Mumbai debut, making it one of the largest and most underperforming IPOs in India for 2024.
Brokerage Recommendations: Analyst Views on Hyundai’s IPO
October 22, 2024, 11:46 AM
Emkay Global initiated coverage with a Reduce rating, setting a target price of ₹1,750. Their analysis points to Hyundai’s lack of major launches and lower earnings growth potential over the next few years, with a muted EPS growth rate of around 5%.
Nomura Holdings Inc.
- Rating: Buy
- Target Price: ₹2,472
Nomura expects Hyundai Motor India to benefit from volume growth and price hikes. They forecast an 8% volume CAGR driven by new models.
Macquarie
- Rating: Outperform
- Target Price: ₹2,235
Macquarie believes Hyundai deserves a premium PE multiple due to its portfolio and premium positioning, suggesting a 14% upside to its IPO price.
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Hyundai Motor India: Global Sentiment
October 22, 2024, 11:08 AM
Despite strong institutional backing, Hyundai’s IPO saw tepid retail demand, with retail investors buying less than half of the shares reserved for them. The stock debuted at ₹1,934 on the NSE, down from its issue price of ₹1,960.
Bloomberg noted that while institutional buyers helped push the IPO to an oversubscription of 2.37 times, retail investors were less enthusiastic due to concerns over Hyundai’s valuations and market trends in the auto industry.
Hyundai Motor India IPO: Industry Context
October 22, 2024, 10:36 AM
The broader Indian auto industry has seen a slowdown in retail demand, which analysts say has contributed to Hyundai’s lackluster debut. Despite India being the world’s fastest-growing major economy, Hyundai has struggled to attract retail investors, primarily due to the cooling demand for automobiles in the country.
IPO Details:
- IPO Price: ₹1,960
- Listed Price (NSE): ₹1,934
- Listed Price (BSE): ₹1,931
- IPO Size: ₹27,870 crore
- QIB Portion Subscribed: Nearly 7 times
- Retail Portion Subscribed: Less than 50%
Stock Outlook: Long-Term Potential for Hyundai Motor India
October 22, 2024, 11:24 AM
Despite a weak listing, analysts remain optimistic about Hyundai Motor India’s long-term prospects. As the country’s second-largest automaker, Hyundai is poised to benefit from India’s growing middle class and the automotive market’s anticipated growth.
Though underperforming in the short term, Hyundai’s IPO may offer long-term value, especially given the company’s focus on electric vehicles and future model launches.
Key Factors Influencing Hyundai’s Performance:
| Key Factor | Impact on Hyundai Motor India | Analyst Comment |
|---|---|---|
| Lack of Major New Launches | Negative | Limits EPS growth over the next 12-18 months. |
| Valuation Concerns | Negative | High valuations relative to Korean parent and peers. |
| Premiumization Strategy | Positive | High-quality product offering, driving margin growth. |
| Institutional Investor Demand | Positive | Strong institutional backing, though retail lagging. |
Hyundai Motor India’s Future: Challenges and Opportunities
Hyundai is in a position to leverage India’s growing economy, expanding middle class, and rising automotive demand. The company could see significant revenue growth over the coming years with plans to introduce new models, including electric vehicles.
- Electric Vehicles (EVs): Hyundai’s parent company is heavily investing in EV technology, positioning the company to capitalize on India’s push toward sustainable mobility solutions.
- New Launches: The company is expected to launch up to 7-8 new models by FY27, including facelifts of existing models.
- Growth Projections: Hyundai Motor India is forecasted to see an 8% volume CAGR over FY25-27.
Disclaimer
This content is for informational purposes only and should not be considered investment advice. Please consult a financial advisor for professional guidance regarding stock market investments.