Hyundai India’s US$3.3 billion IPO was subscribed in 42 per cent on the second day of bidding on Wednesday (Oct 16), led mostly by employees, who were offered shares at a discount and already oversubscribed their part of the offer.
The IPO was subscribed 18 per cent when it opened for bidding on Tuesday. There is still one day of bidding to go.
Its shares are expected to debut on the stock markets on Oct 22.
Hyundai’s India IPO is the country’s largest share sale and the automaker’s first listing outside of its home market of South Korea. It is also the second-largest IPO globally so far this year.
The subscription numbers offer a snapshot of demand that some analysts say reflects investors’ caution about its valuation, which they say is too close to market leader Suzuki Maruti, while others say the IPO’s sheer size means it will take longer to be fully subscribed.
Hyundai India’s employees, bid for 1.3 times the 778,400 shares reserved for them, according to exchange data.
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Qualified institutional buyers subscribed to 58 per cent of the shares allotted to them, while retail investors, who have the biggest portion of shares reserved, have subscribed to 38 per cent of the roughly 49.5 million shares available.
India is the world’s third-largest car market, where sales have hit record highs for the last two years, driven by rising SUV sales that make up about two-thirds of Hyundai’s volumes in the country.
Indian equities markets have also soared to record highs this year, prompting companies to increasingly raise funds through primary share sales.
Over 260 companies have raised more than US$9 billion so far this year, according to LSEG data, which has already eclipsed the US$7.4 billion raised during this period last year. REUTERS
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