South Korean automaker's Indian arm Hyundai Motor India Ltd will launch the largest initial public offering (IPO) in the country's history next week, aiming to raise Rs 27,870 crore (about USD 3.3 billion).
This IPO will surpass the Rs 21,000 crore offering by Life Insurance Corporation of India (LIC) in May 2022.
Apart from these two, the biggest initial share-sales in India include One97 Communications (Paytm), which mobilised Rs 18,300 crore in November 2021, followed by Coal India's Rs 15,199 crore in October 2010, Reliance Power's Rs 11,563 crore in January 2008, and General Insurance Corporation of India's Rs 11,176 crore in October 2017.
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Hyundai Motor India Ltd (HMIL) has set a price band of Rs 1,865 to Rs 1,960 per share for the offering, valuing the automaker at Rs 1.6 lakh crore (about USD 19 billion).
The offering will open for public subscription on October 15 and conclude on October 17. Anchor investors will bid on October 14.
With this massive IPO, Hyundai Motor India seeks to build on its growing market presence and capitalise on strong demand for its vehicles in the country. The offering is expected to draw significant investor interest.
The company's proposed IPO is entirely an Offer-for-Sale (OFS) of 142,194,700 equity shares by promoter Hyundai Motor Company, with no fresh issue component.
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This development marks a significant milestone for the Indian industry, as it is the first initial share sale of an automaker in over two decades, following Japanese carmaker Maruti Suzuki's listing in 2003.
The South Korean parent is diluting some of the stake through the OFS route. Since the public issue is completely an OFS, Hyundai Motor India Ltd, the second largest carmaker in India after Maruti Suzuki India, will not receive any proceeds from the IPO.
HMIL expects that the listing of the equity shares will enhance its visibility and brand image and provide liquidity and a public market for the shares.
At the upper end of the price band, the IPO size has been pegged at Rs 27,870 crore
HMIL commenced operations in India in 1996 and is selling 13 models across segments.
The IPO launch comes at a time when the primary market is experiencing strong interest from both issuers and investors across various sectors.
Moreover, 63 companies have already mobilised around Rs 64,000 crore collectively via mainboard, marking a 29 per cent increase from Rs 49,436 crore collected by 57 firms through the route in the entire 2023.
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