Hyundai Motor India's subdued listing aside, two major brokerage notes have issued Buy recommendations on the car maker with target prices of over 20%, betting the fifth largest automotive company is poised for 'great heights'.
Earlier on October 22, Hyundai Motor India shares made a weak debut on the exchanges, listing at 1.32 percent discount on the NSE to its initial public offer (IPO) price Rs 1960.
Chung Eui-sun, the executive chairman of Hyundai Motor Group was present during the listing ceremony in Mumbai, and pitched that HMIL will align with India's ambitions of being a developed nation by 2047. "As India marches towards Vikisit Bharat 2024 vision, Hyundai will stand as a trusted partner in it," Chung said.
Motilal Oswal has placed a target of Rs 2,345 on Hyundai Motor India (HMIL) and highlighted a diverse mix of products across mid-segment as well as SUV and premium category in India. HMIL is also the second-largest car exporter with export revenue clocking a CAGR of 25%. Going forward, exports may be a key growth driver for Hyundai Motor India, said Motilal Oswal, pegging an export volume CAGR of 11% over FY25-27.
Despite FY25 emerging as a moderate year for car makers, HMIL is poised for a 8% volume CAGR over next two years, with prospects of 17% earnings CAGR over FY25-27E. MOSL Research said it is willing to accord a slight premium to Hyundai Motor India compared to Maruti Suzuki - its closed rival - as HMIL promises 'prowess in emerging technologies', and shows better financial metrics. Its note to investors said Hyundai Motor India commands a 'better' brand perception and is 'better-aligned' to industry trends.
Hyundai Motor India has a strong backing from the parent group, and MOSL said it sees support in areas like OEM supply chain, manufacturing, and product development.
However, a delayed revival in domestic passenger car demand and supply chain disruptions remain risks, and so do regulatory changes, along with any delay in capacity ramp up.
Nomura too has initiated a Buy call with a target price of Rs 2,472 on Hyundai Motor India, and said that it sees the trend of premiumisation in Indian car industry drive high-quality growth at HMIL. Riding on the projections of new launches and upcoming facelift of existing models, Nomura sees a 8% CAGR growth over FY25-27, with EBITDA margin improving to 14% by FY27. Nomura said it expects HMIL to deliver a 17 percent earnings CAGR over FY25-27.
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