Mon Oct 14 21:15:14 UTC 2024: ## Hyundai India IPO: Biggest IPO in India Opens Amidst Concerns

**New Delhi, India**: Hyundai Motor India’s initial public offering (IPO), set to open on October 15th, is poised to be the largest IPO in India, exceeding even LIC’s ₹21,000 crore IPO. However, the IPO has faced a significant downturn in its grey market premium (GMP), dropping from ₹570 in late September to a mere ₹65.

Experts advise investors to base their decisions not on GMP but on the company’s financials. Hyundai Motor India’s IPO price is set at ₹1865-1960 per share, valuing the company at a staggering $19 billion, surpassing its parent company Hyundai Motor.

While the IPO is considered “subscribe” worthy by most brokerage houses due to strong growth potential, robust financials, and a compelling SUV product range, concerns persist about the high valuation and potential competition.

**Listing Gains vs. Long-Term Potential**: While limited listing gains are anticipated, analysts suggest Hyundai Motor India’s shares could deliver double-digit returns in the medium to long term, citing strong growth potential in the passenger vehicle segment. The company’s robust export strategy, aiming to make India an export hub, could further boost its shares. However, investors are cautioned against expecting significant listing gains.

**Key Highlights of the IPO:**

* **IPO Size:** ₹27,870 crore, making it the largest IPO in India
* **Issue Price:** ₹1865-1960 per share
* **Listing Date:** October 22nd
* **Valuation:** $19 billion, exceeding parent company Hyundai Motor

**Concerns surrounding the IPO include:**

* **High Valuation:** Hyundai Motor India’s P/E ratio of 27 is significantly higher than its parent company’s P/E ratio of 5.
* **Competition:** The launch of new products by other automakers poses a threat to Hyundai’s market share and profitability.
* **Inter-Company Relationships:** Hyundai Motor India’s linkage with Kia Motors, a company with a 34% stake owned by Hyundai Motor, raises concerns about potential competition within the same product lines.

Overall, while Hyundai Motor India’s IPO presents a compelling opportunity for long-term growth, investors should proceed with caution, focusing on the company’s fundamentals rather than short-term listing gains.

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