The initial public offering of Hyundai Motor India Ltd, the Indian subsidiary of South Korean automaker Hyundai, saw an 18 percent subscription on its first day of bidding on Tuesday.
According to the data released by the National Stock Exchange, the Rs 27,870 crore initial share sale received bids for 1,77,89,457 shares against 9,97,69,810 shares on offer.
Hyundai Motor India Ltd (HMIL) on Monday raised Rs 8,315 crore from anchor investors.
The retail individual investors segment (RIIs) achieved a subscription rate of 26 percent, while non-institutional investors achieved a 13 percent subscription. Meanwhile, the quota for qualified institutional buyers (QIBs) saw a subscription rate of 5 percent.
This is recorded as the largest IPO in the country, surpassing LIC’s initial share sale of Rs 21,000 crore.
The IPO, with a price band of Rs 1,865-1,960 per share, will remain open for public subscription from October 15 to October 17.
The IPO is entirely an offer for sale (OFS) of 14,21,94,700 equity shares by promoter Hyundai Motor Company (HMC), with no fresh issue component.
This marks the first initial share sale by an automaker in over two decades, following the listing of Japanese carmaker Maruti Suzuki in 2003. The South Korean parent company is reducing its stake through the Offer for Sale (OFS) route. Being a fully only for sale IPO, Hyundai Motor India Ltd, the second largest carmaker in India after Maruti Suzuki, will not receive any proceeds from the IPO.
HMIL anticipates the listing of its equity shares will improve its visibility and brand image, as well as offer liquidity and a public market for the shares.
At the upper end of the price band, the IPO size has been pegged at Rs 27,870 crore ($3.3 billion), and the company’s market valuation at around Rs 1.6 lakh crore (about $19 billion) post-issue.
HMIL began operating in India in 1996 and sells 13 models across various segments, at present.
Kotak Mahindra Capital Company Ltd, Citigroup Global Markets India Private Ltd, HSBC Securities and Capital Markets (India) Private Ltd, JP Morgan India Private Ltd, and Morgan Stanley India Company Private Ltd are the book-running lead managers for the offer.