Hyundai Motor India IPO: Revolutionizing India’s Stock Market

In this week’s review, we take a closer look at the highly anticipated IPO of Hyundai Motor India Limited (HMIL), exploring the motivations behind the move, its projected market value, and the potential effects on India's rapidly growing automotive sector.

Hyundai Motor India’s Public Offering: All You Need to Know

The Securities and Exchange Board of India (SEBI) has given the green light for Hyundai Motor India’s ₹27,870 crore initial public offering (IPO), which is set to be the largest in Indian history. The offering is structured as an Offer for Sale by Hyundai Motor Company and is set to open on October 15. This public offering comes at a time when the Indian automotive sector is booming, with over 4 million cars sold in 2023, making India the third-largest car market globally.

Hyundai’s Draft Red Herring Prospectus (DRHP) was submitted in June 2024. The company plans to offer 142.2 million shares, equivalent to 17.5% of its stake, for sale.

Reasons for Hyundai Going Public

1. Leveraging India’s Automotive Growth

With India’s automotive market experiencing rapid expansion, Hyundai aims to capitalize on this momentum with its public offering.

2. EV Market Expansion

India is set to become the third-largest market for electric vehicles (EVs), and Hyundai’s IPO positions it as a major player in this high-potential segment.

3. Strategic Share Sale

Hyundai Motor Company is offering 17.5% of its stake in the Indian subsidiary, enabling Indian investors to partake in the company’s growth trajectory.

The Hyundai Motor India IPO is purely an Offer for Sale, which means that Hyundai Motor Company will receive all proceeds. Hyundai Motor India will not benefit directly from the funds raised.