Hyundai Motor India IPO Lists at Discount: ₹1,934 on NSE, ₹1,931 on BSE

Hyundai Motor India Limited, India's second-largest auto OEM company, made a disappointing debut on the Indian stock market on Tuesday, 22nd October 2024, with its shares listing at a discount to the issue price on both the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE).

Listing Details

• NSE Listing Price: Hyundai Motor India shares were listed at ₹1,934 per share on the NSE and On the BSE, the stock opened even lower at ₹1,931 per share, marking a weak start to its journey as a publicly traded company.
• Comparison to Issue Price: The listing price represents a discount to the IPO issue price. Hyundai Motor India had set its IPO price band from ₹1,865 to ₹1,960 per share, with the final issue price being fixed at the upper end of ₹1,960.
• Percentage Change: The listing price translates to a discount of 1.3% on NSE and 1.48% on BSE below the issue price of ₹1,960.

First-Day Trading Performance

• Opening vs. Latest Price: Following its weak opening, Hyundai Motor India's share price continued to decline. By 10:37 AM, the stock was trading at ₹1,880.60, down 2.76% from its opening price and 4.05% below the issue price.
• Market Capitalisation: As of 10:37 AM, the company's market capitalisation stood at ₹1,52,806.48 crore.
• Trading Volume: The traded volume was 153.62 lakh shares with a traded value of ₹2,939.62 crore, indicating significant investor interest despite the weak debut.

Market Sentiment and Analysis

• Market Reaction: The market reacted cautiously to Hyundai Motor India's listing, continuing the trend of large IPOs listing at a discount. This marks the sixth IPO above ₹10,000 crore to list at a discount.
• Subscription Rate: The IPO was moderately oversubscribed by 2.37 times, with QIBs leading at 6.97 times subscription, while NIIs (0.60 times) and retail investors (0.50 times) showed lukewarm response.
• Trading Range: The stock hit a high of ₹1,970 and a low of ₹1,844.65 during early trading.

Growth Drivers and Challenges

Expected drivers of future performance:

• Strong market position as India's second-largest auto OEM
• Extensive network of 1,366 sales points and 1,550 service points
• Planned expansion with additional $4 billion investment
• Diverse product portfolio including EVs

Potential challenges:

• Competitive automotive sector
• Market volatility affecting large-cap listings
• Economic factors impacting auto industry

Financial Performance

The company has demonstrated strong financial growth:

• Revenue increased by 16% to ₹71,302.33 crore in FY2024 from ₹61,436.64 crore in FY2023
• Profit After Tax (PAT) rose by 29% to ₹6,060.04 crore in FY2024 from ₹4,709.25 crore in FY2023

As Hyundai Motor India begins its journey as a listed entity, market participants will closely monitor its ability to leverage its strong market position and execute its expansion plans to drive future growth and improve shareholder value. The weak listing suggests cautious market sentiment towards large IPOs, though the company's strong fundamentals and growth plans may support long-term performance.

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