Hyundai IPO would be India’s biggest stock offering

Reuters, Mumbai, February 5 The South Korean company is doubling down in the important growing market ahead of Tesla’s highly anticipated debut. Hyundai Motor (005380.KS), opens new tab, plans to list its Indian arm to generate at least $3 billion in what would be the nation’s biggest initial public offering (IPO), according to two people.
The two persons, who have been briefed on the topic, stated on condition of anonymity that Hyundai Motor India is in early talks for an initial public offering (IPO) and has held discussions with numerous banks. The discussions are not yet public.

Hyundai, the country’s second-largest carmaker with a 15% market share, is raising money that may put the worth of its Indian business at as much as $30 billion—more than half of its $42 billion market capitalization in Seoul. On Monday, the company’s shares surged 5%, reaching their highest level in almost three years.
With a potential valuation of up to $30 billion, Hyundai’s India division would trail competitors such as Maruti Suzuki India (MRTI.NS) at $40.11 billion and Tata Motors (TAMO.NS), which opens a new tab at $41.43 billion.

An India-based Hyundai representative declined to comment.
According to the two persons, the corporation is looking into “value unlocking for its India business” through the IPO.
“They wish to capitalize on the IPO boom in India. One of the two individuals continued, “India’s capital markets have rarely stood out like way in comparison to other nations.
India’s $4 trillion stock market, which has recently surpassed Hong Kong as the fourth-largest in the world, has grown quickly as a fast-growing alternative to China, helped by billions of dollars in both domestic and foreign investment.

The benchmark Nifty 50 index in India (.NSEI) opened a new tab and increased by 20% in 2023, continuing its record run into 2024.
Bankers anticipate that the surge in initial public offerings (IPOs) in India during the second half of 2023 will continue in 2024, as policy stability is hoped for. Among the companies anticipated to IPO this year are food delivery service Swiggy and softbank-backed Ola Electric.

An IPO in India raised $6.78 billion for 239 firms in 2023, according to LSEG statistics.

India’s largest insurer, Life Insurance Corporation (LIFI.NS), opened a new tab, had its largest initial public offering (IPO) in 2022, raising up to $2.7 billion.

HYUNDAI’S PUSH INDIA
Hyundai, the second-biggest automaker in India based on sales, is now expanding its presence in both the US and South Asia. It had previously reduced its output in China due to years of losses and left the country after selling its two facilities there.

Hyundai’s market share in India peaked at almost 20%, primarily because of its extensive selection of small cars and understanding of consumer preferences. However, domestic competitors like Tata Motors (TAMO.NS), opens new tab, which has introduced a number of new SUVs and electric vehicles, are becoming more and more competitive.

Hyundai currently holds a 15% market share in India, where it sold 567,000 cars during the most recent fiscal year.

Currently, Hyundai produces automobiles at its plant in Chennai, known as the Detroit of Asia, in southern India.