DRHP For Upcoming IPO
Hyundai Motor India Ltd (HMIL) has taken an important step toward its long-awaited initial public offering by filing with SEBI its draft red herring prospectus – with plans to raise up to $3 billion through share sales, it would become India’s biggest ever initial public offering (IPO), surpassing Life Insurance Corporation of India ($2.7 billion in 2022.).
As an independent company, HMIL would be able to diversify its sources of capital and enhance liquidity on the domestic market while decreasing HMIL’s dependence on its South Korean parent company which currently supplies around 70% of funds for operations.
HMIL will distinguish their initial public offering (IPO) from most others by not selling new shares but instead selling off part of their stake to retail and institutional investors via offer for sale route.
DRHP For Upcoming IPO
Investment banks Kotak Mahindra Capital, Citibank, HSBC Securities, Morgan Stanley and JP Morgan will facilitate this transaction while Shardul Amarchand Mangaldas will serve as legal counsel to HMIL. By listing in India’s fast-growing automotive market and capitalising on domestic operations HMIL shows confidence and strength while raising its profile against domestic rivals such as Maruti Suzuki and Tata Motors.
To ensure a successful listing, HMIL has appointed Kotak Mahindra Capital Company Ltd, Citigroup Global Markets India Pvt. Ltd, JP Morgan India Pvt Ltd and HSBC Securities and Capital Markets (India) Pvt Ltd as book-running lead managers for its forthcoming share sale IPO. This will ensure minimal disruptions during execution of its offering process.
Hyundai Motor India Limited (HMIL) submitted with SEBI an Initial Public Offering Draft Red Herring Prospectus with plans of raising $3 billion through an Initial Public Offering (IPO). They plan on selling approximately 142 Million shares with face values of Rs10 each at their offering price for their IPO.
DRHP For Upcoming IPO
Draft Prospectus does not disclose pricing or valuation information, however sources have speculated that HMIL could be valued up to $30 billion. According to sources, its South Korean parent company could sell approximately 17.5% stake of HMIL through an initial public offering (IPO), which may lead to substantial shareholder dilution.
Hyundai Motor India Ltd (Hyundai India) hopes to take advantage of one of the world’s fastest-growing auto markets by listing on an initial public offering (IPO), in hopes that such an IPO listing can help it shed its valuation discount compared with global and Asian competitors and generate extra capital that can be used for dividend payouts and buybacks.
DRHP For Upcoming IPO
Hyundai recognizes India as its third-largest revenue generator and has already invested $5 billion there, promising another $4 billion over 10 years. Hyundai plans to increase EV market share via charging stations while expanding production capacity, increasing exports through increased production capacity; furthermore, India serves as an essential source for raw materials required by their manufacturing facilities requiring further expansion of supply chain operations locally.
4. The Offering Price for HMIL’s Initial Public Offering is Available
Bankers anticipate that HMIL will offer up approximately 175% of its post-offer paid-up equity share capital during its IPO offering, raising approximately $142.2 million shares or approximately 17.5%.
DRHP For Upcoming IPO
HMIL hopes its forthcoming initial public offering (IPO) will unlock value in its Indian business and reduce any valuation discounts it might experience when compared with its global and Asian peers. Furthermore, this offering should increase cash flow and strengthen balance sheets; Kotak Mahindra Investment Bank Limited (KMIL), Citibank, Morgan Stanley JP Morgan and HSBC have been appointed by HMIL as agents to oversee this offering process.
As India’s second-largest carmaker, HMIL is well positioned to capitalize on the rising demand for passenger vehicles in India. Their Santro and Creta models have proven popular; expansion projects are underway including capacity upgrades at existing plants as well as Talegaon; expansion projects will likely also include plans for capacity enhancement at Talegaon later on. With their initial public offering (IPO), HMIL hopes to tap India’s robust market potential while simultaneously raising funds needed to fund them.
