Korean car major Hyundai Motor is looking to sell around 17% stake in its Indian arm through an initial share sale (IPO), which may be India’s biggest issue so far, to raise as much as £2,5 billion, valuing the company at around £15 bn. With this, Hyundai will join other auto players such as Maruti Suzuki, Mahindra & Mahindra and Tata Motors in tapping the capital markets for raising funds.
Others such as Ola have also lined up an IPO, with the proposal cleared by market regulator Sebi recently. The Indian arm of the Korean company, which had been preparing for the IPO for the last one year or so, is likely to file the draft red herring prospectus (DRHP) with Sebi very soon, detailing the fund raise plans, growth opportunities, and other key financial metrics. Hyundai India’s IPO will be an offer for sale by the existing shareholder, with no fresh issue of shares planned. Citi India, JP Morgan India, Kotak Mahindra Capital are among the merchant bankers which will be managing the offer, sources said.
The timing is, however, yet to be finalised. “Sebi’s process may stretch for a few months. The stock markets are at record highs and look buoyant. Hyundai will want to see an early clearance to take benefit from the current positive sentiments,” a source said.
“The company is also in a rush as the car market appears to be veering towards a slowdown,” the source added.
