IPO: Hyundai’s premium down 70% in grey market, reaches 147 as soon as price fixed; last week of September

New Delhi| Brokerage houses do not seem happy with the price of Hyundai Motor India, which is launching the country’s largest IPO. As the company priced the shares on Wednesday, its premium in the gray market dropped by 70 percent. According to brokerage houses, the company has fixed the issue price at Rs 1,865 to Rs 1,960. Its premium in the grey market is Rs 147 at the upper price. That means, if this premium continues further, investors can get a profit of only seven percent if shares are listed. In the last week of September, Hyundai’s share price was trading up by Rs 570 in the gray market. Last week it had dropped to Rs 360. In this week it has fallen further to below Rs 200.

Hyundai Motor India will enter the market from October 15 to raise Rs 27,870 crore from the IPO. The issue will close on October 17. Anchor investors will be able to bid on 14. After listing, the market capitalization of the company will be Rs 1.6 lakh crore.

Before Hyundai’s IPO, Life Insurance Corporation of India (LIC) came out with the country’s largest issue of Rs 21,000 crore in 2022. Paytm had an IPO of 18,300 crore in 2021, Coal India 15,199 crore in 2010, Reliance Power 11,563 crore in 2008 and General Insurance 11,176 crore in 2017. So far this year, 63 companies have raised 64,000 crore from IPOs.