Hyundai Motor India shares jump 6% a day after dull debut

Synopsis

Hyundai Motor India Share Price Today: Shares of Hyundai Motor India rose nearly 6% to Rs 1,928 after a lackluster listing. The Rs 27,870 crore IPO was fully subscribed and included an offer for sale from Hyundai Motor Global.

Shares of Hyundai Motor India surged nearly 6% to Rs 1,928 during Wednesday's trading session on the BSE, a day after their dull listing on the exchanges.

Hyundai Motor India had a weak debut on Tuesday, opening at Rs 1,934 on the NSE, a discount of 1.3%, or Rs 26, below the issue price of Rs 1,960. The stocks also closed 6% lower at Rs 1,820 from their listing price on Tuesday.

The Rs 27,870 crore IPO was booked 2.3 times, with full subscription achieved only on the last day. The issue was a complete offer for sale (OFS) of 14.2 crore shares, offloaded by the company's parent, Hyundai Motor Global. Since the IPO was an OFS, all proceeds will go to the selling shareholder.

Meanwhile, on listing day, global brokerage firm Nomura has initiated coverage on Hyundai Motor with a 'Buy' rating and a target price of Rs 2,472.

"The company is riding on style and technology and its ongoing premiumization should drive high-quality growth. There is a long runway for the Indian car industry – current penetration at 36 cars/1,000 people. HMI poised for healthy long-term growth due to its style and technology. Capacity expansion in H2 and the launch of several new models (including four EVs) over the next 3-4 years are the key catalysts," Nomura said.

Another global brokerage firm, Macquarie, also initiated coverage on Hyundai Motor with an 'Outperform' rating and a target price of Rs 2,235.

"The company is a pure play on PV premiumisation and growth. Macquarie believes that Hyundai deserves to trade at a premium PE multiple versus peers and its market share in core segments has stabilised/improved from recent lows. The global brokerage firm sees a favourable portfolio mix and premium positioning. Powertrain optionality, including parent capabilities and market share upside risk," Macquarie said.

Although all proceeds from the IPO will go to the parent company, management stated that funds will be allocated for research and development and new innovative offerings.

Hyundai has historically maintained a stable share market presence in India and enjoys loyalty among consumers due to its smooth and affordable after-sales service.

Equipped with R&D from Korea and an automated factory in Chennai, the company has optimized its operations while expanding its distribution. The automaker also plans to gradually become a major player in the EV segment.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)

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