Hyundai Motor India IPO 2024 The world’s third largest auto original equipment manufacturer (OEM) is Hyundai Motor Company. Hyundai Motors is known to everyone, they manufacture and sell four-wheeler passenger vehicles with new technology and reliable and innovative features. They deal in 13 models of all vehicles like sedans, hatchbacks, sports-utility vehicles (SUVs) and battery electric vehicles (EV). Now, Hyundai is offering some IPO shares to the public to raise funds. They are targeting to raise $3 billion, which will mark it as one of the largest IPOs in India’s history. While the exact amount to be raised is not given in the draft red herring prospectus (DRHP) submitted to the Securities and Exchange Board of India (SEBI). Apart from this, Hyundai has held talks with major investment banks including JP Morgan, Morgan Stanley, Citi and Bank of America to manage the IPO. While no formal appointment has been made yet.
Hyundai Motor India is going to hold an IPO soon. They have already submitted the papers to SEBI. They are planning to hold an IPO of around $3 billion, which is expected to be India’s largest IPO record after Life Insurance Corporation of India’s $2.5 billion issue in 2022.
Hyundai Motor India IPO 2024
Hyundai Motor India IPO has been set up. But no information has been given about the size of the IPO yet. According to bankers, they are targeting to raise around $2.5 – $3 billion in the upcoming IPO issue, which will value the company at $25-30 billion. As per the DRHP, the proposed IPO is an OFS of 142,194,700 equity shares through Hyundai Motor Company, with no fresh issue component. Hence, they will be offering 142.2 million equity shares, which is 17.5 percent of the post-offer paid-up equity share capital. Hence, it is said that this is a fully IPO issue across the board.
- Company: Hyundai Motor Company
- IPO size: About $3 billion
- Valuation: Target of about $30 billion for Indian unit
- Objective: To expand operations in India, especially in electric vehicles (EVs) and related infrastructure
- Expected market impact: Expected to become India’s largest IPO in 2022, surpassing Life Insurance Corporation’s $2.7 billion IPO.
Strategic Reasons for the Hyundai Motor India IPO 2024
- Expensive in India:- Companies issue IPOs to go public from private and aim to raise funds. Hyundai Motor Company plans to accelerate its growth in India with the IPO. Hyundai Motor Company has been active in the auto market for 25 years and is the second largest car manufacturer in India by sales. Hyundai Motor Company plans to become the first such company and wants to expand its presence in the Indian market.
- Reducing Dependency on Parent Company:- Hyundai company wants to become independent in itself. By issuing IPO shares and raising funds locally, they are trying to minimize their dependence on the parent company for capital and enhance their financial position. By having a balanced financial position, they become financially independent and flexible.
- Competing with Local and Global Rivals:- Hyundai is best placed in the Indian market, but with the growing competition from local companies like Tata Motors and the expected entry of Tesla in the Indian market, they need to increase their presence. Hyundai is planning to strengthen its presence especially in the EV sector with this IPO release.
Usage of Hyundai Motor India IPO Proceeds
- Electric Vehicle (EV) Development
- Charging Infrastructure
- Battery Pack Assembly Unit
- Expensive of Manufacturing Capacity
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