Hyundai Motor India's shares dropped by 2% on their first day in the stock market. Retail investors didn’t show much interest in the company's large initial public offering (IPO). The shares started at 1,934 rupees on the National Stock Exchange, which is less than the original price of 1,960 rupees. Later, the shares were trading at 1,920 rupees.

 

Why did Hyundai’s shares drop?

 

Hyundai's $3.3 billion IPO got more interest than expected, being bought more than twice what was available. However, most of this interest came from big investors, not regular people. Small retail investors were worried about the price, which is why many didn’t buy, causing the stock price to go down.

Hyundai is India’s second-biggest carmaker, with 15% of the market. It joined the Indian stock market when stock prices were going up. This is the first time Hyundai has been listed outside of its home country, South Korea. Even though it was a big IPO, some experts are worried about the company’s value. Hyundai is valued at 26 times its expected 2024 profits, which is close to the value of the market leader, Maruti Suzuki, which is 29 times.

Hyundai India IPO GMP

Hyundai India's shares were being sold for 2.4% more than their official price in the grey market, suggesting that investors expected some gains when the shares were listed. However, this extra premium kept getting smaller as the IPO date got closer. The grey market is an unofficial place where shares are traded before they officially get listed.

 

IPO information

 

Hyundai India set the price for its shares between Rs 1,865 and Rs 1,960. The IPO was available for investors from October 15 to October 17. The company raised Rs 27,870 crore through the IPO, which was entirely an "offer for sale" of 14.22 crore shares, meaning existing shareholders sold their shares.

 

About the Hyundai Motor India

 

Hyundai Motor India Limited, started in May 1996, is part of the Hyundai Motor Group, which is the third-largest car maker in the world. The company makes reliable, modern, and feature-packed cars, along with important parts like engines and transmissions.

Hyundai sells its cars through 1,366 sales points and has 1,550 service centres across India. By March 31, 2024, the company had sold almost 12 million cars in India and through exports.

From March 31, 2023, to March 31, 2024, Hyundai’s revenue grew by 16%, and its profit after tax (PAT) increased by 29%.