By Mohit Kumar
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Discover Hyundai's IPO plans as they prepare to issue up to 142 million shares, out of a total of 800 million outstanding shares. Stay informed with our comprehensive website.
Key Highlights:
Hyundai's India IPO aims to accelerate the company's growth in a market where it has been operating for over 25 years. Popular models like the Santro and Creta have established a strong presence among Indian buyers.
South Korea's Hyundai Motor plans to sell up to 17.5% of its stake in the initial public offering (IPO) of its India unit, potentially raising up to USD 3 billion. This could mark India's largest ever IPO. Hyundai Motor India Ltd., the country's second-largest carmaker after Maruti Suzuki, will not issue new shares. Instead, the IPO will involve the South Korean parent company selling part of its stake in the wholly-owned unit via an "offer for sale" route.
Regulatory Filing
Hyundai is expected to file the IPO papers with the stock market regulator as early as Friday. Once approved, the listing will take place in Mumbai.
Financial Impact
This listing will be Hyundai's first outside South Korea. The company aims to raise between USD 2.5 billion and USD 3 billion from the stake sale. The final stake percentage may be lower than 17.5%. Previous estimates value Hyundai's India unit at up to USD 30 billion.
Strategic Goals
The IPO aims to reduce Hyundai Motor India's dependence on its Korean parent for funds, providing the financial strength to compete with local rivals such as Tata Motors. The company also plans to sell locally-made electric vehicles, set up a charging network, establish a battery facility, and expand manufacturing capacity in India.
Risk Factors
In its filing with the Securities and Exchange Board of India (SEBI), Hyundai must list "risk factors" for investors. These include dependence on the Korean parent and related party transactions within the Hyundai Group. The potential reduction or unavailability of government incentives for electric vehicle makers in India is also cited as a risk.
Share Issuance
Hyundai plans to issue up to 142 million shares in the IPO, out of a total of 800 million outstanding shares.
Company Response
Hyundai Motor India declined to comment on the IPO details.