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Hyundai Motor India to launch ‘mother of all IPOs’ next week
The size of the IPO at the upper limit of the price band will surpass LIC's ₹21,000 crore IPO in May 2022, valuing Hyundai's Indian unit at $19 billion
Hyundai Motor India will launch its $3.32 billion (₹27,870 crore) initial public offer next week in what will be its South Korean parent’s first listing outside its home market and India’s first carmaker IPO since Maruti Suzuki in 2003.
The size of the initial share sale at the upper limit of the price band between ₹1,865 and ₹1,960 ($22-23) per share will surpass Life Insurance Corporation of India’s (LIC’s) ₹21,000 crore IPO in May 2022, valuing Hyundai’s Indian unit at about $19 billion.
The company’s parent will sell 142 million shares, or 17.5% of the total equity, in the IPO, which will be a complete offer for sale (OFS).
One lot is divided into seven shares, followed by multiples of seven thereafter.
The issue will open for subscription on 15 October and close on 17 October. Hyundai Motor India’s shares will carry a face value of ₹10 each.
About 50% of the shares on offer have been reserved for qualified institutional buyers, while 15% has been reserved for non-institutional investors, and the rest 35% for retail investors.
The automaker is offering a discount of ₹186 per share to eligible staff who will bid in the share sale.
Hyundai, which is the second largest original equipment maker and the second largest exporter of passenger vehicles, has a domestic market share of 14.6%.
In September, Hyundai sold 64,201 units, a a 10% year-on-year decline. This year so far, the company has sold 577,000 units, which is flat when compared with last year.
Hyundai set shop in India in 1996, starting with the Santro hatchback which was then its most sold car.
It has one factory in Chennai, dubbed the Detroit of Asia, which has an annual production capacity of 824,000 units and a utilization rate of 94%.
The automaker plans to hit an annual production run rate of about 1 million units with the acquisition of a former General Motors plant in Maharashtra. The plant is expected to commence operations by the second half of the year to March 2026.
In India, Hyundai sells 13 models, of whom ‘Creta’ and ‘Venue’ sport utility vehicles, and the ‘Grand i10 Nios’ hatchback are its best-selling models.
Cars produced at its current factory are shipped to South Africa, the Middle East as well as Latin America.