Hyundai IPO shares to list today; will it deliver any surprise on stock market debut?

Shares of Hyundai Motor India will make their Dalal Street debut today, that is on Tuesday. The passenger vehicle maker is likely to have a flat listing at the bourses as suggested by the latest signals from the unofficial market. The latest grey market premium suggests that the company is set to make a muted listing late today. 
 

Grey market premium (GMP) of Hyundai Motor India has seen some rebound after a sharp correction, which was hinting towards a discount listing when the issue had closed for bidding, after disappointing interest for the issue. Last heard, the company was commanding a premium of Rs 20-25 per share, suggesting a loss of around one per cent for the investors.
 

The majority of the investors, especially NII's and  retail stayed back on few reasons like concern over high valuations to peers followed by 100 per cent offer-for-sale (OFS) component without any fresh issue leaving nothing on table for new investors. There is a very high possibility of flat to negative market debut, said Prashanth Tapse, Senior VP (Research) at Mehta Equities.
 

"One should not expect quick bucks on listing day. Hence, we recommend hold despite knowing short term volatility in the sector demand and supply scenario. For non-allottees, we advise to wait and watch for the price to settle and revisit the space with better discounted opportunities as for long-term investors, Hyundai’s growth story remains intact," he said.
 

The IPO of Hyundai Motor India ran for bidding between October 15 and October 17. The PV player had offered its shares in the fixed price band of Rs 1,865-1,960 per share with a lot size of 7 shares. The car maker raised about Rs 27,856 crore via its primary offering was entirely an offer-for-sale (OFS) of 142,194,700 shares by its South Korean-parent Hyundai Motor Company.
 

The issue saw a muted bidding and was overall subscribed merely 2.37 times. The quota for qualified institutional bidders (QIBs) was booked 6.97 times, while the reservation for employees was subscribed 1.74 times. The portion reserved for non-institutional investors and retail investors saw bidding for merely 60 per cent and 50 per cent during the bidding process.
 

The Hyundai Motor India IPO was a highly anticipated issue due to the company’s strong market position in the Indian passenger vehicle segment. The shares might list around Rs 2,035, said Master Capital Services.
 

"Despite some concerns regarding short-term listing gains due to subdued grey market premium, the company offers steady growth prospects amid industry tailwinds, robust financials and healthy SUV product demand. Hyundai’s leadership in the Indian market, along with its strategic focus on electric vehicles makes a compelling investment for long-term investors," it said.
 

Chennai-based Hyundai Motor India is a part of South Korea's Hyundai Motor Group, which is the third largest auto original equipment manufacturer (OEM) in the world based on passenger vehicle sales. It manufactures and sells four-wheeler passenger vehicles, including models such as sedans, hatchbacks, SUVs, and electric vehicles (EVs).
 

Brokerages mostly have a positive view on the issue and suggest subscribing for a long-term. Kotak Mahindra, HSBC Securities & Capital Markets, Citigroup Global Markets India, JP Morgan India and Morgan Stanley India were the book running lead managers of the Hyundai Motor IPO, while Kfin Technologies served as the registrar for the issue.