Hyundai Motor India’s IPO offering was oversubscribed by more than two times after attracting aggressive bidding from institutional investors, according to Reuters.
The IPO was India’s largest and positions Hyundai for future growth in India building on its already strong performance in the Indian automotive market.
Reuters reported that the Hyundai IPO drew bids worth $5.51 billion at close of bidding yesterday, over twice the value of the shares on offer.
The news agency said that prior to the open bidding process, institutional investors such as BlackRock and Fidelity, had purchased shares worth nearly $1 billion as part of the offering.
However, Bloomberg reported that the sale was barely 40% subscribed in the first two days amid weak demand from retail investors.
The capital raised is expected to support capacity growth in India and aid Hyundai’s transition to EVs, further establishing its position as a global production hub.
Vivek Kumar, Project Manager, Automotive at GlobalData, said: “With the IPO, Hyundai Motor India is poised to set a new benchmark for success in India. To effectively compete in the highly competitive automotive market, and growing local powerhouses such as Tata Motors and Mahindra, Hyundai must continuously innovate and customize its vehicles to maintain its market position.
“Therefore, Hyundai’s strategy must carefully balance cost and quality to remain attractive to value-conscious buyers. While the success of models such as the Creta and Venue indicates a positive reception for Hyundai’s SUVs, the company must remain vigilant in updating its lineup to stay ahead.”
