Shares of Hyundai Motor India rose 6 percent to Rs 1,929 in the afternoon on October 23, following its market debut. However, the biggest IPO in India disappointed investors, as it listed at a discount and closed more than 7 percent lower.
Despite mounting concerns about the automobile sector's demand slowdown, a host of analysts are bullish on Hyundai as they see major support levers for the future. At about 1:15 pm, shares were trading at Rs 1,911, higher by 5 percent from the last close on the NSE.
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Motilal Oswal has set a target of Rs 2,345 for Hyundai Motor, emphasizing its diverse product range across the mid-segment, SUV, and premium categories. As the second-largest car exporter, HMIL has achieved a 25 percent CAGR in export revenue, with exports expected to drive future growth. The firm projects an export volume CAGR of 11 percent over FY25-27.
Although FY25 may be a moderate year for the automotive industry, the company is positioned for an 8 percent volume CAGR over the next two years, with a 17 percent earnings CAGR over FY25-27E. Motilal Oswal Research has given Hyundai a slight premium over its close competitor Maruti Suzuki, citing Hyundai’s strength in emerging technologies and superior financial metrics.
International brokerage Nomura also a 'buy' call on the newly-listed entity. It highlighted the company's focus on style and technology. The ongoing premiumization is expected to drive high-quality growth, with the company projected to deliver an 8 percent volume CAGR over FY25-27, supported by the launch of 7-8 new models, including facelifts. Nomura anticipates EBITDA margins to improve to 14 percent by FY27, driven by a better product mix, cost reduction, and operating leverage. Overall, Hyundai is expected to deliver a 17 percent earnings CAGR over FY25-27.
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