Hyundai Initial Public Offering (IPO) Is Approaching. Will It Be As Successful As The Maruti IPO?

The massive South Korean automaker Hyundai Motor Corporation is preparing to list Hyundai Motor India Limited (HMIL), its Indian affiliate, in what may turn out to be India’s largest-ever initial public offering (IPO). It was previously stated that HMIL planned to hold an initial public offering (IPO) later this year. For the IPO in India, the company has now hired merchant banks and legal companies in an effort to speed up the process. According to reports, regulatory documents for approval might be submitted as early as May or June.

The Hyundai IPO is expected to be the biggest in India to date, with a valuation of between $3–3.5 billion (or Rs 25,000 crore). Hyundai’s Indian operations might be worth up to $30 billion according to this assessment. At $2.6 billion (Rs 21,000 crore), Life Insurance Corporation of India (LIC IPO) now holds the record for the largest initial public offering (IPO) in India. Hyundai’s decision to list its subsidiary in India highlights its dedication to the Indian market.

Hyundai has hired domestic Indian investment banks and well-known merchant banks like JP Morgan, HSBC, and Citi to provide advice on its anticipated $3 billion initial public offering (IPO) in India. It is anticipated that the IPO will value Hyundai’s Indian division at more than half of the company’s approximately $47 billion market capitalization in Seoul.

Shardul Amarchand Mangaldas (SAM) has been engaged by Hyundai as the legal counsel for the IPO of Hyundai Motor India Ltd. Furthermore, Latham & Watkins, a worldwide law firm, has been engaged as international legal counsel. Hyundai’s choice of these companies demonstrates its dedication to a seamless initial public offering (IPO) procedure and adherence to Indian regulatory mandates.

There is a lot of curiosity in how Hyundai’s IPO may affect rival Maruti Suzuki, the biggest passenger car maker in India. The IPO of Hyundai, which has the second-largest market share in India, may affect Maruti Suzuki’s standing in the industry. Hyundai’s impressive 2023 performance, which included record-breaking 6.02 lakh domestic sales and a 10% rise in exports, is indicative of the company’s expanding market share in India.

Conversely, Maruti Suzuki has been progressively increasing its market share due to the triumph of its introduction of SUVs. But if Hyundai’s valuation is seen as a benchmark, then Maruti Suzuki shares may be exposed to upside risks as a result of Hyundai’s IPO. Analysts speculate that Maruti Suzuki and Hyundai would trade at comparable prices because of things like Suzuki’s substantial market share in India and Hyundai’s standing in the world.

An important move for the Indian auto sector, Hyundai’s IPO has ramifications for Maruti Suzuki and other rivals as well as for Hyundai itself. The Indian automobile market’s competitive environment and investor attitude may change as a result of the IPO.

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