Hyundai India’s Shares Fall 2% as Market Reacts to Record IPO Performance
Market Response to Hyundai India’s IPO
Hyundai India’s shares fell 2% in their market debut on Tuesday, reflecting a tepid response from retail investors to the country’s largest ever initial public offering (IPO). The stock listed at 1,934 rupees ($23) on India’s National Stock Exchange, which was lower than its issue price of 1,960 rupees ($23.31). At the latest trading hour, shares were reported at 1,920 rupees ($22.84) at 0431 GMT (12:31 a.m. ET).
Concerns Over Investor Sentiment
Hyundai Motor India, holding the status of India’s No. 2 carmaker with a 15% market share, launched a record $3.3 billion IPO that was oversubscribed more than two-fold last week primarily by institutional investors. Pricing concerns have deterred significant retail participation, making Tuesday’s listing in Mumbai particularly noteworthy for the company, marking its first outside of South Korea.
- Prior biggest IPOs like Life Insurance Corporation and Paytm parent, One97, both listed at a steep discount.
- Hyundai’s valuation is smaller than market leader Maruti Suzuki’s $48 billion.
- Analysts express concerns over valuation comparisons, as Hyundai is priced at 26 times its fiscal 2024 earnings, close to Maruti’s 29 times multiple.
Strategic Investments in India
Hyundai counts India as a crucial growth market, having invested $5 billion with plans to inject another $4 billion over the next decade. As the world’s third-largest car market after China and the United States, it plays a significant role in Hyundai’s revenue generation strategy globally.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.