On Tuesday, Hyundai Motor India Ltd (HMIL), the Indian unit of the South Korean automaker, had a rough start in the stock market.
The company’s shares were listed at Rs 1,931, showing a small premium of 1.47% over the issue price of Rs 1,960.
However, the stock dropped by 7% during trading. The next day, Wednesday, the stock rebounded, increasing by 6% to reach an intraday high of Rs 1,928.15.
Despite the rocky start, domestic brokerage firms remain optimistic about the stock. Motilal Oswal Financial Services has given a “buy” rating for Hyundai Motor India, with a target price of Rs 2,345.
Hyundai: The Fifth Most Valuable Automobile Company
Hyundai Motor India became the fifth most valuable automobile company in India based on market capitalization on the day of its listing.
The company’s IPO was subscribed 2.37 times by the end of the offer period. The IPO price range was set between Rs 1,865 and Rs 1,960 per share, with the total IPO size being Rs 27,870 crore.
Shivani Nyati, Head of Property Division at Swastika Investmart Ltd, mentioned that even though the stock was listed below the issue price, Hyundai’s strong fundamentals ensure its long-term growth potential.
Hyundai’s IPO: The Largest in India
Hyundai Motor India’s IPO was the largest in the history of the Indian stock market, surpassing the previous record set by Life Insurance Corporation of India’s (LIC) Rs 21,000 crore IPO.
The IPO saw strong demand from qualified institutional buyers (QIBs), with their segment receiving 6.97 times subscription.
Non-institutional investors subscribed to 60% of their quota, while retail investors subscribed to 50%.
Before the IPO officially opened, Hyundai Motor India raised Rs 8,315 crore from large anchor investors.
