Hyundai’s Mega IPO in India: $3-3.5B Expected Raise

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Hyundai has selected JP Morgan, Citi, and HSBC as advisors for the planned mega IPO of its Indian arm. The decision to enlist these financial institutions reflects Hyundai’s strategy to leverage their expertise and global network in executing a successful initial public offering. The move is part of Hyundai’s efforts to capitalize on the growing demand for electric vehicles in India and strengthen its presence in the country’s automotive market.

In a significant move towards its mega IPO venture in India, Hyundai Motor has secured the advisory services of prominent investment banks JP Morgan, Citi, and HSBC. This strategic decision underscores Hyundai’s ambitious plan to raise between $3 billion to $3.5 billion through its Indian unit’s initial public offering. Sources familiar with the matter revealed that the draft papers for this monumental deal are anticipated to be filed by June 2024, potentially marking the largest IPO in the history of Indian stock exchanges.

Impending Filing of Draft Papers by June 2024

Industry insiders suggest that the formal submission of draft papers for this landmark IPO could materialize as early as June 2024. This move aligns with Hyundai’s proactive approach towards capitalizing on the burgeoning Indian market and expanding its global footprint.

Strategic Partnership with Leading Investment Banks

Hyundai’s decision to enlist the expertise of JP Morgan, Citi, and HSBC underscores its commitment to executing a seamless and successful IPO. These reputable financial institutions bring a wealth of experience and market insight to the table, positioning Hyundai for a robust debut on the Indian bourses.

Potential to Break Records

Should Hyundai’s IPO plans come to fruition, it would surpass previous records to emerge as the largest-ever IPO in India. The current record-holder, LIC’s $2.7-billion listing in 2022, could potentially be eclipsed by Hyundai’s ambitious fundraising endeavor.

Expansion of Advisory Panel

While JP Morgan, Citi, and HSBC are currently onboarded as advisors, there remains a possibility of additional investment banks joining the advisory panel in the subsequent stages of the IPO process. This strategic flexibility underscores Hyundai’s commitment to ensuring comprehensive support and expertise throughout the IPO journey.

Market Response and Official Statements

Upon the initial report by The Economic Times regarding Hyundai’s India listing plans, the market responded with anticipation and interest. Hyundai Motor Co, in response to media inquiries, reiterated its commitment to exploring opportunities for enhancing corporate value, including the possibility of listing overseas subsidiaries. However, no definitive decisions have been made as of the latest official statement.

Hyundai’s Significance in the Indian Market

India continues to be a pivotal market for Hyundai, accounting for approximately 13 percent of its global sales in 2023. The success of Hyundai’s car models such as i20, Verna, Kreta, Aura, and Tucson, underscores the brand’s resonance with Indian consumers and its strong market positioning.

Robust Performance in 2023

Despite challenging market conditions, Hyundai’s India unit reported record-breaking domestic sales in 2023, surpassing the six-lakh mark. This impressive performance, coupled with a notable increase in export figures, underscores the resilience and competitiveness of Hyundai’s operations in India.

Market Maturation and Global Appeal

Udhay Furtado, Co-Head of Equity Capital Markets at Citi, highlighted the evolving landscape of the Indian market, emphasizing the allure for global brands to explore listing opportunities in India. This sentiment reflects the growing confidence in India’s financial ecosystem and its capacity to attract prominent global players.

Emerging Trends in the Auto Sector

Beyond Hyundai’s IPO venture, the Indian auto sector is witnessing other significant developments, notably the impending IPO of Ola Electric, backed by Softbank and Temasek. This landmark move signifies the growing prominence of electric vehicle firms in India’s capital markets and sets the stage for further innovation and investment in the sector.

By leveraging the expertise of leading investment banks and capitalizing on the burgeoning Indian market, Hyundai is poised to make a significant impact with its mega-IPO venture. As market dynamics continue to evolve, Hyundai’s strategic positioning and proactive approach position it as a formidable player in India’s ever-expanding financial landscape.

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