Hyundai’s Indian stock listing to proceed as IPO fully sold

NEW DELHI: The Indian stock market listing for the local unit of Hyundai Motor Co will proceed as planned, after the record offering was fully sold on the final day.

The South Asian nation’s largest-ever listing had struggled to attract enough bids amid weak sentiment in the broader market.

Indian auto stocks have seen particularly sharp recent selling as the industry witnesses a cooling from the pandemic-driven demand surge.

The offering of Hyundai Motor India Ltd will raise $3.3 billion at the upper end of the indicated price range, with its Korean parent selling a stake of as much as 17.5%.

The Indian unit is valued at about $19 billion and shares are set to start trading on Oct 22.

The offer was barely 40% subscribed in the first two days of the sale amid lackluster demand, while gray market trading was also weak. Local rules mandate minimum subscription of 90% for IPOs to proceed with listing.

The initial sluggishness contrasted sharply with the stellar performance of listings earlier this year that made India the world’s busiest IPO venue.

The nation’s broader stock market has underperformed in recent weeks as investor attention shifts to prospects of China stimulus.

Institutional investors were the main buyers, placing bids for more than three times the amount of shares set aside for them.

The company on Monday said it had allocated 83.2 billion rupees ($990 million) worth of shares to 225 anchor investors at 1,960 rupees apiece, the top of the marketed range.

Buyers of the shares include BlackRock Inc and Baillie Gifford, confirming an earlier Bloomberg News report.

With Hyundai’s proceeds, Indian IPOs will have raised more than $12 billion this year, eclipsing volumes for the past two years but still below the record $17.8 billion raised in 2021, according to data compiled by Bloomberg.

Other pending debuts include food-delivery company Swiggy Ltd. and the renewable-energy arm of state-run power producer NTPC Ltd.