Hyundai IPO: Hyundai Motor India’s IPO has opened for subscription from today, Tuesday, October 15. This issue will remain open for investors till October 17. Hyundai Motor India’s IPO price band has been fixed at Rs 1,865 to Rs 1,960 per equity share. Let us tell you that the size of this IPO is Rs 27,870 crore (about 3.3 billion dollars). This is the biggest IPO till date. Earlier the size of LIC IPO was Rs 21,000 crore. Apart from these, One97 Communications, the parent company of Paytm in India, had come up with an IPO of Rs 18,300 crore in November 2021. Apart from this, Coal India Limited had launched an IPO of Rs 15,199 crore in October 2010. However, as much as there is buzz in the market about Hyundai IPO, it also has risk factors. According to market analysts, flat listing of the company’s shares is possible. This stock is continuously falling in the gray market also. In such a situation, if you are thinking of investing in this issue, then let us know what the experts say..
analyst opinion
Analysts do not have much expectation from Hyundai IPO. According to market analysts, bumper listing of the company’s shares is not possible. Gray market trends are pointing towards flat listing or negative listing. In such a situation, investors willing to invest money may have to hold the stock for at least one year to get healthy returns. Let us tell you that the demand for shares in the gray market premium i.e. unlisted market is negligible. Its gray market premium is continuously decreasing.
Shares of Investorgain company are available in the gray market with a premium of Rs 40. This means that Hyundai Motor shares can be listed at Rs 2000 with a premium of 2%. Let us tell you that till now this stock has fallen by 92% in the gray market. Its GMP on September 27 was at ₹570. Analysts are also considering this as a sign of negative listing.
Motilal Oswal believes that in the upper price band, the company is being valued at 26.2 times its FY24 earnings. Also, if annual valuation of FY25 earnings is done, its value is 26.7 times. The company has a market cap of Rs 15,92,581 million after issuing equity shares. The price-to-sales ratio based on FY24 earnings is 2.28. “We believe the issue is completely priced based and we recommend subscribing to the IPO for the long term,” the brokerage said.
At the same time, this IPO has the tag of ‘Subscription’ of Aditya Birla Capital. “Hyundai has gone from strength to strength and has been one of the most recognized brands in India since its inception and has been a first mover across various PV categories,” the brokerage firm said. We believe the outlook for Hyundai remains strong. However, at the upper price band, Hyundai is available at a valuation of 26x its FY24 EPS. “It is recommended to subscribe to this issue for long term,” the brokerage said.
IPO of vehicle manufacturing company came after a long time
Let us tell you that Hyundai Motor India Limited, the Indian unit of South Korean vehicle manufacturing Hyundai, had raised Rs 8,315 crore from anchor investors on Monday, a day before its IPO. The company’s IPO comprises an offer for sale of 142,194,700 equity shares by Hyundai Motor (promoter selling shareholder). The company started operations in India in 1996 and is selling 13 models across different segments. This IPO is important for the Indian industry because after two decades an automobile manufacturing company is launching its IPO. Earlier, Japanese automobile manufacturing company Maruti Suzuki had brought IPO in 2003.
(with agency input)