HYUNDAI Motors India IPO: Biggest IPO in Indian History
Over the years, the Indian stock market has witnessed a number of big IPOs, which attracted a lot of investors. LIC IPO was one of the largest one amounting Worth ₹20,600 crore. Beginners and experienced investors were talking about it, and it developed a lot of interest and excitement in the financial community. It soon gained popularity as one of the most talked IPOs in history of Indian stock market.
However, Indian market is getting ready for even bigger IPO which is expected to be more exciting and larger than the LIC IPO. The biggest IPO in the history of the Indian stock market HYUNDAI Motors India IPO, will be valued at around ₹27,700 crore and is set for release. An IPO of this size has never been seen in the market before, and investors are very excited for same.
List of Biggest IPO till date in INDIA
| Issue Name | Issue Size in Cr. |
| Life Insurance Corporation of India (LIC) | 21008.48 |
| Adani Enterprises Limited | 20000.00 |
| One 97 Communications Limited (PAYTM) | 18300.00 |
| Vodafone Idea Limited | 18000.00 |
| Coal India Limited | 15199.44 |
Importance of studying Large IPOs
When an IPO of this scale releases, it is necessary that investors do a thorough analysis of the offerings. In such a huge IPOs, the allotment is usually large, but it is necessary to make the right decision. This IPO is going to start on October 14-16 expectingly and the projected listing date will be October 21-22, which is right before Diwali.
Large IPOs like this have historically been associated with market volatility and correction. The Indian stock market has shown correction signals previously as well; therefore, it appears that this time is no different. This volatility might have increased due to global issues as well, currently which is the geopolitical tensions between Iran and Israel. Particularly in the run up to such a sizable IPO, these corrections have the potential to increase market volatility.
High Valuation IPO?
In the Indian four-wheeler sector, HYUNDAI Motors India holds a sizeable 18% market share which is ₹60,000 crore. However, it falls short against their rivals such as TATA Motors which has recorded revenue of ₹4.45 lakh crore, Mahindra Motors which has recorded revenue of ₹1.42 lakh crore, and Maruti which reported revenue of ₹1.47 lakh crore. This IPO is priced little high, with a P/E ratio that can rise to 33-35 times if the stock price stays between ₹1,800 and ₹1,900. With this valuation, it is at little higher side with pricing compared to their competitors.
This high valuation could limit the potential returns for regular investors. This IPO seems costly and may not be appealing to many investors if the price band reaches ₹2,000. However, investors would be more than happy if the price band remains between ₹1,500 and ₹1,600 because of the stronger value prospective.
Grey Market Premium and Explained
The grey market was very high, and investors were excited when the IPO was originally announced, with a projected price point of about ₹1,200.
But the GMP started to decrease as more information about the IPO became available. The premium dropped to ₹500 at the end of last week, and there were rumors that the price band would go up. The price band may really move to about ₹2,000, in that case the GMP would fall much lower and public opinion of this IPO will become negative.
Shareholder Quota in HYUNDAI Motors India IPO?
Is there going to be a shareholder quota for this IPO? No, is the response. Which is one of the most common inquiries about IPO. A parent company must already be listed in India then only shareholder quota can exist, which is not the situation in this IPO.
Market Impact of Large IPOs
IPO is set to withdraw ₹27,700 crore from the market, which may significantly impact on market liquidity. Furthermore, three to four other large IPOs are also lined up for a release before December this year, which will further drain liquidity. The market’s liquidity will get impacted if these IPOs take about ₹80,000 crore out of the market collectively, which may result in a more severe fall in market.
Additionally, the market’s views have already been impacted by recent regulatory changes implemented by SEBI, which are the expansion of lot sizes for F&O and the elimination of weekly expiry. There will be a decrease in the options trading market probably as a result of these adjustments and the massive IPOs that are draining liquidity. Many traders could instead switch their attention to IPOs in search of safer profits.
Hyundai Motors India IPO: Details
| IPO Date | 15th of Oct, 2024 to 17th of Oct, 2024 |
| Listing Date | 22nd of Oct, 2024 (Tentative Date) |
| Price Band | ₹1865 to ₹1960 per share |
| Lot Size | 7 Shares |
Hyundai Motors India IPO: Lot Size
| Application | Lots | Shares | Amount |
| Retail (Min) | 1 | 7 | ₹13,720 |
| Retail (Max) | 14 | 98 | ₹192,080 |
| S-HNI (Min) | 15 | 105 | ₹205,800 |
| S-HNI (Max) | 72 | 504 | ₹987,840 |
| B-HNI (Min) | 73 | 511 | ₹1,001,560 |