Hyundai Motor India shares rebound 6% a day after muted market debut
Hyundai Motor share price: The stock moved up 5.92 per cent to hit a day high of Rs 1,928.15. Yesterday, the passenger vehicle (PV) maker's scrip was listed at Rs 1,931 on BSE, a discount of 1.48 per cent over its issue price of Rs 1,960. Later, it had settled 7.12 per cent lower at Rs 1,820.40.
- Oct 23, 2024,
- Updated Oct 23, 2024 1:15 PM IST
Shares of Hyundai Motor India Ltd staged a recovery in Wednesday's trade following a tepid stock market debut during the previous session. The stock moved up 5.92 per cent to hit a day high of Rs 1,928.15. Yesterday, the passenger vehicle (PV) maker's scrip was listed at Rs 1,931 on BSE, a discount of 1.48 per cent over its issue price of Rs 1,960. Later, it had settled 7.12 per cent lower at Rs 1,820.40.
Emkay Global has initiated coverage on Hyundai but with a 'Reduce' call, suggesting a 12-month target price of Rs 1,750. "We initiate coverage on Hyundai Motor India (HMIL) with REDUCE (TP of Rs1,750, at ~23x core Sep-26E PER, similar to MSIL) amid a lackluster ~5 per cent EPS CAGR over FY24-27E. HMIL has established a strong franchise in India; however, lack of major launches (key growth driver historically in PVs) over the next 12-18M, muted ~5 per cent capacity CAGR, higher royalty, and lower treasury income are likely to restrict EPS growth," the brokerage stated.
"While Maruti Suzuki India Ltd (MSIL) (REDUCE) also faces similar near-term growth challenges, we prefer it over HMIL given its catch-up on operational and financial metrics (even on lower SUV mix) with a much-diversified product and powertrain mix and a higher growth optionality (potential small-car recovery, aggressive 8% capacity CAGR, 7-seater SUV launch in H2FY26E, and 10 new models by 2030) driving a superior 6%/10% revenue/EPS CAGR over FY24-27E," Emkay further said.
Kranthi Bathini, Director of Equity Strategy at WealthMills Securities, said, "If we see Hyundai's valuations, it is a better bet for medium- to long-term investors. Hyundai Motor is a formidable player in the OEM (original equipment manufacturer) space. So, it is definitely a long-term bet in the auto segment."
Chakri Lokapriya, Managing Partner at RedStrawBerry LLP, said, "Hyundai, like Maruti Suzuki, is a global company and has access to R&D and the latest technological trends that are happening across the globe. This is important in the car industry which is going through a massive change such as electrification, battery storage, etc. Hyundai is the second-largest player in India after Maruti and has about 13-14 models. Apart from the global R&D access, it is developing battery storage technologies within India. Hyundai also has a range of EV models which will further propel future growth."
If we add up all these things together, the company is likely to reflect a profit growth north of 20 per cent, Lokapriya added.
Hyundai's initial public offering (IPO) was open for subscription between October 15 and October 17. Overall, the Hyundai Motor issue received 23,63,26,265 bids against 9,97,69,810 shares on offer with a total subscription of 2.37 times, thanks to institutional investors.
The IPO was entirely an offer-for-sale (OFS) by its South Korean parent Hyundai Motor Company. Ahead of its initial share sale, the company had raised Rs 8,315.3 crore from anchor investors.
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).
Shares of Hyundai Motor India Ltd staged a recovery in Wednesday's trade following a tepid stock market debut during the previous session. The stock moved up 5.92 per cent to hit a day high of Rs 1,928.15. Yesterday, the passenger vehicle (PV) maker's scrip was listed at Rs 1,931 on BSE, a discount of 1.48 per cent over its issue price of Rs 1,960. Later, it had settled 7.12 per cent lower at Rs 1,820.40.
Emkay Global has initiated coverage on Hyundai but with a 'Reduce' call, suggesting a 12-month target price of Rs 1,750. "We initiate coverage on Hyundai Motor India (HMIL) with REDUCE (TP of Rs1,750, at ~23x core Sep-26E PER, similar to MSIL) amid a lackluster ~5 per cent EPS CAGR over FY24-27E. HMIL has established a strong franchise in India; however, lack of major launches (key growth driver historically in PVs) over the next 12-18M, muted ~5 per cent capacity CAGR, higher royalty, and lower treasury income are likely to restrict EPS growth," the brokerage stated.
"While Maruti Suzuki India Ltd (MSIL) (REDUCE) also faces similar near-term growth challenges, we prefer it over HMIL given its catch-up on operational and financial metrics (even on lower SUV mix) with a much-diversified product and powertrain mix and a higher growth optionality (potential small-car recovery, aggressive 8% capacity CAGR, 7-seater SUV launch in H2FY26E, and 10 new models by 2030) driving a superior 6%/10% revenue/EPS CAGR over FY24-27E," Emkay further said.
Kranthi Bathini, Director of Equity Strategy at WealthMills Securities, said, "If we see Hyundai's valuations, it is a better bet for medium- to long-term investors. Hyundai Motor is a formidable player in the OEM (original equipment manufacturer) space. So, it is definitely a long-term bet in the auto segment."
Chakri Lokapriya, Managing Partner at RedStrawBerry LLP, said, "Hyundai, like Maruti Suzuki, is a global company and has access to R&D and the latest technological trends that are happening across the globe. This is important in the car industry which is going through a massive change such as electrification, battery storage, etc. Hyundai is the second-largest player in India after Maruti and has about 13-14 models. Apart from the global R&D access, it is developing battery storage technologies within India. Hyundai also has a range of EV models which will further propel future growth."
If we add up all these things together, the company is likely to reflect a profit growth north of 20 per cent, Lokapriya added.
Hyundai's initial public offering (IPO) was open for subscription between October 15 and October 17. Overall, the Hyundai Motor issue received 23,63,26,265 bids against 9,97,69,810 shares on offer with a total subscription of 2.37 times, thanks to institutional investors.
The IPO was entirely an offer-for-sale (OFS) by its South Korean parent Hyundai Motor Company. Ahead of its initial share sale, the company had raised Rs 8,315.3 crore from anchor investors.
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).