Hyundai Files for IPO, Potentially India’s Biggest IPO Surpassing LIC
Image Credit: Reuters File photo [Hyundai Logo]
It is likely to be seen as India’s biggest IPO since LIC, which set a record by selling shares worth Rs 21,000 crore in 2022. Hyundai Motor India filed for an initial public offering, filing preliminary papers with SEBI for an IPO in which the company will sell approximately 142 million shares as per a draft red herring prospectus.
IPO details suggest that the carmaker aims to raise $2.5 billion to $3 billion, valuing the company at $25-30 billion. If things go according to plan, it would surpass the record of LIC’s IPO of 2022, where they raised Rs 21,000 crore through share sales.
In the financial year 2024, Hyundai India Ltd was recognized as the second-largest carmaker after Maruti Suzuki in terms of passenger sales volume. As they are set to offload a 17.5% stake through this IPO, it is considered to be a pivotal step for the organization if they raise Rs 25,000 crore in Indian currency.
It would be a significant decision for Hyundai as it aims to list against established automotive giants. The South Korean company is in a crucial position; if the IPO goes successfully, it will help them to increase their market capitalization and enhance their production and service capabilities.
HMIL plans to invest Rs 6,000 crore in the newly acquired plant from General Motors in Talegaon and Rs 26,000 crore in Tamil Nadu over the next 10 years to expand its production unit, EV manufacturing and charging unit, as well as the component ecosystem and skill development.
The last time an automotive giant entered the market through an IPO was Maruti, with a price range of Rs 125 per share above the floor price of Rs 115, where the government decided to divest 25% of the stake in 2003. At the issue price, the company was valued at around Rs 3,600 crore. In May 2007, the Government of India fully exited from Maruti, selling its 10.3% stake for Rs 2,360 crore.
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