Hyundai Motor Company has just confirmed its filing for an initial public offering (IPO) in India.
The South Korean automaker aims to raise approximately $2.5 to $3 billion at a valuation of up to $30 billion, Reuters reported, citing three sources familiar with the matter.
Hyundai aims for record-breaking IPO in India
Hyundai is reportedly planning to sell a stake of up to 17.5% as part of the proposed IPO of its India unit to raise up to $3 billion. In fact, it has already submitted the Draft Red Herring Prospectus (DRHP) to the Securities and Exchange Board.
For context, the DRHP is a preliminary document for the South Korean automaker’s public launch in the Indian market.
It could be the largest IPO in the country’s history. Moreover, it will make Hyundai the first automaker in India to go public in two decades since Maruti Suzuki in 2003.
The SEB is expected to make a final decision on Hyundai’s IPO proposal in the subsequent three to six months.
Targeting up to $30 billion valuation
Hyundai Motor Company owns 100% of Hyundai Motor India Limited’s subsidiary since its launch in 1996.
It aims to publicly sell some of its existing shares in the Indian subsidiary rather than issuing new shares for the planned IPO.
Specifically, it plans to sell 142 million shares out of its total 812 million shares of the Hyundai Motor India Limited subsidiary. The move is part of its efforts to gain up to $3 billion in the IPO, potentially achieving a value of approximately $30 billion for its Indian subsidiary.
Hyundai’s footprint in India
Hyundai’s potential IPO in the Indian market will substantially aid the company in expanding its local operations.
The country is currently the third-biggest automotive market in the world, just behind China and the US.
Therefore, it is no longer surprising that the South Korean company aims to grow its operations in the domestic market. Its strong dedication enabled it to become the second top-selling automaker in the country, following homegrown brand Maruti Suzuki.
Hyundai already has an annual production output of 1 million vehicles. Its investments reached $5 billion in two factories in Chennai, which crank out 850,000 units a year.
In 2023, it bought an ex-GM production plant in Talegaon. It boasts an annual production output of 130,000 units.
It has further plans to boost its investment in India with an additional $4 billion over the next decade to roll out new EVs, charging stations, and battery packs.
