Hyundai Motor shares: Nirmal Bang downgrades stock, other brokers increase target prices

Domestic brokerage firm continues to remain largely positive on Hyundai Motor India Ltd, increasing the target price on it, citing its strong product pipeline and capacity additions. On the other hand, Nirmal Bang Institutional Equities has downgraded the recently listed passenger vehicles player after the recent rally.

Hyundai Motor India reported a 3.7 per cent year-on-year (YoY) decline in consolidated net profit at Rs 1,614 crore in the March 2025 quarter, while its revenue from operations increased 1.5 per cent YoY to Rs 17,940 crore. Ebitda for Q4FY25 was up marginally to 2,532.23 crore, while Ebitda margin stood at 12.9 per cent. It announced a dividend of Rs 21 per share.

Hyundai Motor India reported a beat on consensus estimates across key financial metrics in Q4FY25, aided by a Rs 175 crore government incentive that flowed through Ebitda and profit, said Nirmal Bang Institutional Equities. Ebitda and PAT were ahead of consensus, supported by localization benefits and the subsidy inflow providing a key uplift, it said.

"We downgrade the stock to 'hold' following a 10 per cent rally over the past month, which limits near-term upside potential. While our core estimates remain unchanged, the recent price appreciation has narrowed the valuation gap. We continue to value the company at 22 times Mar’27E EPS, reflecting confidence in its long-term earnings visibility and strong fundamentals, including premiumization, robust exports, and a solid product pipeline," said Nirmal Bang with a target price of Rs 1,984.

Shares of Hyundai Motor India added nearly a per cent to Rs 1,880 on Monday, commanding a total market capitalization more than 1.8 lakh crore. The stock had settled at Rs 1,859.95 on Friday. Shares of Hyundai Motor have gained nearly 11 per cent in the last one month.

Kotak Institutional Equities expects the wholesale volume trend to remain muted in the near term, given the weak consumer sentiment, continued weakness in entry-level segment demand and a higher base. Given a lack of newer launches, HMI may underperform the industry in the near term.

"However, from CY2026E, we expect the company to gain market share, given the new launches in MPV (product gap) and SUV segments," it added and retain its 'buy' rating with a revised target price of Rs 2,050 (from Rs 2,000 earlier), based on DCF methodology, y, mainly on account of the roll-over.

Hyundai Motor India launched India's biggest ever IPO of Rs 27,870 crore in October 2024 as it sold its shares for Rs 1,960 apiece. The stock is still 4 per cent below its issue price. Despite a 22 per cent rise from its 52-week lows, the stock is still down nearly 5 per cent down from its 52-week high at Rs 1,968.80 hit in October 2024.

For FY26, HMIL expects to grow broadly in line with industry estimates of low-single digit. Exports are expected to contribute 30 per cent of its revenue by 2030, said JM Financial. However, it noted that the near-term outlook for the domestic PV industry remains challenging.

Medium-term volume growth is expected to be driven by 26 launches planned over FY26-30, including 8 models by FY27; and capacity addition in the Pune plant. In the near-term, initial ramp up cost will weigh on margins. We estimate revenue and EPS CAGR of 11 per cent  and 13 per cent over FY25-27E, respectively. We maintain 'buy' with March 2027 target price of Rs 2,050," it said.

Hyundai Motors delivered a much better operational performance as margins improved, aided by an improved mix, lower discounts and higher govt incentives, said Motilal Oswal Financial Services. "We believe HMI remains well placed to benefit from the premiumization trend in India given its mix in favor of SUVs," it said with a 'buy' rating and a target price of Rs 2,137.

Hyundai targets to launch 26 products (including variants) by FY30, of which eight would be launched over FY26-27E. Considering the launch pipeline, we now factor in a 7 per cent volume CAGR for HMI over FY25-27E, largely back-ended, said Motilal Oswal. "We also factor in start-up costs of the new Pune plant to impact earnings in the near term and normalize in FY27E."