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Hyundai to liquidate 17.5% stake in Hyundai Motor India to raise up to $3 billion via IPO

Hyundai to liquidate 17.5% stake in Hyundai Motor India to raise up to $3 billion via IPO

| @indiablooms | 14 Jun 2024, 04:53 pm

Mumbai: South Korean automaker Hyundai plans to reduce its 17.5 percent stake in its Indian subsidiary, Hyundai Motor India, through an initial public offering (IPO) aimed at raising between $2.5 billion and $3 billion, media reports said.

The company will submit its filing to the Securities and Exchange Board of India (SEBI) today.

This move is important for the Indian auto industry, as it marks the first automaker IPO since Japanese carmaker Maruti Suzuki's listing in 2003.

According to Bloomberg, Hyundai intends to use the IPO proceeds to expand its operations.

Kotak Mahindra Bank Ltd and Morgan Stanley have been appointed as advisers for the IPO.

Hyundai, the second-largest carmaker in India after Maruti Suzuki, will not issue new shares; instead, the South Korean parent company will reduce its stake.

If successful, this IPO would become the largest in Indian history, surpassing the Life Insurance Corporation of India's 2022 IPO, which raised about $2.5 billion.

Hyundai India's IPO could significantly impact the automobile sector, potentially sparking investor interest, creating growth opportunities, and transforming the industry landscape.

A successful IPO might also encourage other industry players to consider similar opportunities, fostering a competitive market environment.

In May, Hyundai reported a 7 percent year-on-year increase in total sales, reaching 63,551 units, with exports growing by 31 percent year-on-year to 14,400 units.

The company's sports utility vehicle (SUV) segment has been a major growth driver, accounting for an impressive 67 percent of domestic sales, according to May's data.

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