Hyundai Motor India is preparing to launch a landmark Initial Public Offering (IPO) that is expected to raise around $3 billion, or approximately ₹25,000 crore. This IPO, one of the largest in India’s history.
Key Details:
1. Offer Structure:
– The IPO will be an Offer for Sale (OFS), where Hyundai Motor Co., the parent company, plans to sell about 142 million shares, which is 17.5% of its total shareholding in Hyundai Motor India. This means the proceeds from the IPO will go to the parent company, not towards fresh capital for the Indian subsidiary.
2. Valuation and Market Position:
– The IPO is set to value Hyundai Motor India at approximately $30 billion (₹2.5 lakh crore). If successful, it will be the largest IPO in the Indian automotive sector and the first major IPO by an automaker since Maruti Suzuki’s IPO in 2003.
– Hyundai Motor India is the country’s second-largest passenger vehicle manufacturer, following Maruti Suzuki. The company has a robust production capacity with two plants in Chennai and a newly acquired facility in Talegaon, Maharashtra, boosting its annual production capability to about 1 million units.
3. Strategic Importance:
– Hyundai sees India as a critical market and a potential manufacturing hub, especially as it looks to reduce dependence on markets like China and Russia, where sales have been affected due to geopolitical tensions.
– The IPO aligns with Hyundai’s broader strategy to expand its footprint in India, including plans to invest an additional $4 billion over the next decade. This investment will focus on electric vehicles (EVs), charging infrastructure, and a battery assembly unit. The company is set to launch its first India-made EV in early 2025, with plans to roll out five EV models by 2030.
4. Timeline:
– The IPO is expected to be finalized by the end of October 2024.
This IPO not only marks a significant financial event but also underscores Hyundai’s commitment to strengthening its position in the rapidly growing Indian automotive market. The listing is anticipated to enhance the company’s visibility, brand recognition, and liquidity, providing a strong platform for future growth, particularly in the EV sector.
