Hyundai India IPO Confirmed: Timeline Revealed
The South Korean automotive giant Hyundai Motor India is gearing up to make a mark in the Indian stock market with its upcoming initial public offering (IPO). According to reports, the company is looking to achieve a valuation of around $22-28 billion. The company will file for the IPO in the coming two weeks, and if approved by SEBI, the IPO could take place in the coming 2-3 months.
Hyundai’s Indian IPO Coming Soon
Hyundai Motor India’s IPO is set to become the first IPO by an automaker in India in the last 20 years. For those who may not be aware, the last automaker to have an IPO in India is none other than Maruti Suzuki in 2003. As per the sources, Hyundai Motor India is set to file a draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) within the next two weeks.
Once the DRHP filing is completed, Hyundai Motor India will commence investor roadshows. They will take place both in India and internationally starting next month. These roadshows are crucial for garnering investor interest and providing insights into the company’s future prospects.
As stated above, the market regulator SEBI takes 60-90 days to review and approve the DRHP. Hyundai’s IPO could potentially take place in the market by September or October. Hyundai, for the task of its IPO, has enlisted the services of top investment banks including Citibank, Morgan Stanley, Kotak Mahindra, HSBC, and JPMorgan.
Hyundai Looking to Raise $5.6 Billion
Hyundai Motor India is targeting a valuation between $22-28 billion for its Indian subsidiary. If successful, it could be selling its stake of 15-20% through the IPO. With this, the company aims to raise between $3.3-5.6 billion. It has to be noted that the stake on offer for sale will be by the Korean parent company.
Hyundai’s Future Plans for India
Hyundai Motor India, which currently stands as the second-largest carmaker in the country, is aggressively expanding its product portfolio. The company has shifted its focus to SUVs. The result of this has accounted for 67% of Hyundai’s total sales. Currently, its most popular models are the Creta, Exter, Venue, and Alcazar. On the premium end, the company also sells the Ioniq 5 EV.
Hyundai’s Expansion and EV Plans
Hyundai has committed Rs 33,000 crore for investment over the next decade to increase its production capacity to 1.5 million vehicles. This includes the launch of the first localized EV based on the Creta within a year. It will be followed by a mass-market EV offering by 2026-27. Additionally, Hyundai has partnered with Exide Industries to localize battery cell production. This will be done to reduce costs and make EVs more affordable.
Currently, the company is gearing up for the launch of the Creta EV. It is expected to make its debut by the end of this year. The upcoming Creta EV will most likely get a 45 kWh battery pack, which is likely to be made by Exide for Hyundai. As for the range, it could offer around 400-500 km.
Hyundai to Offer Hybrids in India
Along with the focus on electric vehicles, Hyundai, over the next three years, is planning to enter the hybrid vehicle segment. It is planning to introduce the hybrid variants of the Creta, Venue, and Verna in India. This strategic pivot is in response to the rising demand for hybrid vehicles globally and in India.
According to reports, another one of the key driving factors behind Hyundai’s decision to go the hybrid route is emission norms. Currently, meeting the emission norms for the BS6 diesel engines has proven very costly for the brand. So the company is planning to phase out the diesel engines and replace them with hybrids which are far more efficient.
Hyundai’s Collaboration with Kia
Hyundai Motor India, for those who may not be aware, shares its engines and platforms with its sister company, Kia. This helps both companies in enhancing their scales and technologies. It also helps them in developing new models and technologies more quickly and efficiently, which has helped them in being very competitive in the Indian automotive market.