How might the IPO of Hyundai India impact the shares of Maruti Suzuki, Tata Motors, and M&M?
Hyundai India IPO valuations: According to experts, Hyundai India is selling off about 13% of its ownership in the forthcoming IPO.
Hyundai India IPO: The largest initial public offering (IPO) in the history of the nation is about to take place on the Indian primary market, setting off a historic event. Experts in the stock market estimate that Hyundai India is selling about 13% of its ownership in the impending IPO. However, the company’s enormous scale would allow it to collect close to ₹25,000 crore, surpassing LIC, the largest initial public offering (IPO) in India, by a significant amount. The valuations of Hyundai India’s initial public offering (IPO), according to experts, suggest that the company may do better than its top competitors, including Maruti Suzuki, Tata Motors, Mahindra & Mahindra (M&M), and others.
News of Hyundai India’s IPO
“Hyundai India IPO is going to create a history in the Indian primary market as the upcoming IPO is tipped to trump LIC’s existing record of biggest-ever IPO in the Indian primary market,” stated Sandeep Pandey, Founder of Basav Capital, in reference to the size of the IPO and other facts. The company’s financials indicate that the IPO valuation for Hyundai India would be approximately ₹25,000 crore. It is anticipated that the corporation would make a staggering sum from the sale of its 13 percent interest. The market anticipates that a significant amount of the upcoming IPO will go to the company’s balance sheet, which is expected to enhance its competitiveness against its leading peers like Maruti Suzuki, M&M, Tata Motors, etc., though it is unclear if it will be a 100% fresh issue, a mix of fresh shares and OFS, or entirely OFS.”
Manish Chowdhury, Head of Research at StoxBox, commented, “The big-bang and much-awaited IPO from the second largest PV OEM in India in terms of sales volumes is likely to positively impact the valuation metrics of the overall Indian automobile sector.” Chowdhury was speaking about how the Hyundai India IPO might effect the Indian auto segment on Dalal Street. Hyundai Motor appears ready to further solidify its position in both the domestic and international markets thanks to superior profitability metrics and premium positioning in comparison to Maruti Suzuki. The company has a line of items that will be released in the next one to two years in an effort to boost the ante in the EV market. We could witness more intense competition from well-known companies like Tata Motors and M&M as the corporation places more emphasis on streamlining the entire value chain in the EV market by establishing manufacturing facilities in India.”
“With the PV industry expected to grow in mid-single digits over the next few years, we sense that Hyundai Motor would further strengthen its positioning in the Indian automobile landscape owing to superior financial metrics, premium product mix tilted towards SUV segment, strong parentage of Hyundai, and agility to adapt to the changing consumer preference through continuous R&D and innovation,” said a StoxBox analyst.
According to Amit Goel, Co-Founder and Chief Global Strategist at Pace 360, Hyundai and Maruti Suzuki are competitors in the Indian car industry operating in the same industry. improved R&D spending, improved production capacity, and vigorous marketing campaigns could result from Hyundai’s successful IPO. This can make Maruti Suzuki face more competition in terms of sales and market share. Investor confidence in the automotive industry may be bolstered by Hyundai’s successful initial public offering (IPO), which could result in a rise in interest in and investment in auto stocks generally, including Maruti Suzuki, Tata Motors, and M&M. Based on Hyundai’s estimated growth potential and valuation, investors with an interest in the car industry may reallocate their holdings. Some investors may decide to change their holdings if they believe Hyundai’s IPO offers better growth opportunities or a more competitive valuation, which might drive down share prices. On the other hand, a negative perception of Hyundai’s IPO or poor post-IPO performance might hurt all of the industry’s key companies, including Tata Motors, M&M, and Maruti Suzuki.”
According to the Pace 360 expert, M&M and Tata Motors are significant rivals in several markets (M&M sells SUVs and utility vehicles, while Tata Motors sells passenger and commercial cars). Their tactics may also be indirectly impacted by Hyundai’s IPO, depending on how the company intends to use the proceeds to increase its market share.
Disclaimer: The opinions and suggestions expressed here are those of certain analysts, specialists, and broking firms. Before making any financial decisions, we suggest investors to consult with qualified specialists.
