Hyundai Motor India IPO

Market Leadership: Company is the second largest auto OEM in the Indian passenger vehicles market since Fiscal 2009 and largest auto OEM in India in the mid-size SUV sub-segment. Creta has a market share of 30% in the mid-size SUV sub-segment; Verna is the top selling model in the premium sedans sub-segment with 31.2% market share. Company has been India’s largest exporter of passenger vehicles since Fiscal 2005, exporting 3.53 million passenger vehicles to over 150 countries.

Diverse Portfolio: Company's current portfolio of passenger vehicles caters to a diverse customer base offering “something for everyone”. Their portfolio of 13 passenger vehicle models across major passenger vehicle segments by body type include sedans (Aura and Verna), hatchbacks (Grand i10 NIOS, i20 and i20 N Line) and SUVs (Exter, Venue, Venue N Line, Creta, Creta N Line, Alcazar, Tucson and IONIQ 5).

PAN India Network: Company has 1,366 sales outlets across 1,031 cities and towns in India and 1,550 service centres across India across 962 cities and towns in India. They introduced a “Doorstep Service Programme” in 2020 to provide after-sale services to their customers across primary rural markets and emerging cities through mobile service vans.

Automated Manufacturing Capabilities: Company's Chennai Manufacturing Plant is one of India’s largest single location passenger vehicle manufacturing plants in terms of production capacity. To enhance operational efficiency, they have a common platform architecture across the two manufacturing plants in Chennai and this enables them to manufacture eight different models in one plant.

Digitisation: They have digitised their customers and dealers’ interactions through the 'myHyundai' app and website. Customers interact with them at every stage of the passenger vehicle purchase journey and access after-sale services.

Material Price Hike: Continued fluctuations in the cost of commodities, supply interruptions or, shortages could cause their suppliers to increase their costs, which in turn may have an adverse impact on their ability to manufacture within target cost.

Government Incentives: The unavailability, reduction or elimination of government incentives could have adverse effect on their business, prospects and financial condition. For example, they benefit from incentives including (i) electricity tax exemptions; (ii) investment promotion subsidies in the form of state GST reimbursements, fiscal incentives such as a central sales tax (CST) soft loan at a concessional rate of interest; (iii) clean energy vehicle (CEV) subsidy; and (iv) interest free deferred sales tax.

Stiff Competition: In India, they face competition from domestic and multinational automobile manufacturers. According to the CRISIL report, India’s domestic passenger vehicle industry is an oligopolistic market with few players dominating the entire industry - where Maruti Suzuki leads the passenger vehicle industry in terms of domestic sales volumes, followed by Hyundai, Tata Motors and Mahindra & Mahindra. These four players together contribute approximately 80% of the market. However, in the last five years, the competition in the Indian domestic passenger vehicle market has intensified amidst competitively priced feature-rich passenger vehicle launches by all players as well as recent entrants.

Redevelopment of Talegaon Mfg Plant: Company recently acquired the Talegaon Manufacturing Plant from General Motors India in December '23, which is under redevelopment and is expected to be operational with the first phase to be operational by the second half of Fiscal 2026. In doing so, they could experience delays or other difficulties, such as supply delays, sub optimal construction quality, among others, and may be required to expend significant resources, including financial resources.