Nomura has initiated coverage on Hyundai India (HMI) with a ‘Buy’ rating and a target price of ₹2472, ahead of the company’s listing today. The brokerage firm is optimistic about Hyundai India’s prospects, driven by its strategic focus on style and technology, as well as the ongoing premiumization in the Indian car market.
Key Highlights from Nomura’s Report:
Growth Potential: Nomura estimates that Hyundai India will deliver an 8% volume compound annual growth rate (CAGR) over FY25-27, supported by the launch of 7-8 new models, including facelifts.
Market Penetration: The Indian car market has significant growth potential with current penetration at only 36 cars per 1,000 people, suggesting a long runway for expansion.
EBITDA Margins: Hyundai India’s EBITDA margins are expected to improve to 14% by FY27 from 13.1% in FY24. This improvement will be driven by a better product mix, cost reduction initiatives, and operating leverage.
Earnings Growth: Nomura anticipates a 17% earnings CAGR for Hyundai India over FY25-27, reflecting the company’s strategic initiatives and market positioning.
Nomura’s positive outlook on Hyundai India is rooted in the company’s ability to adapt to market demands and leverage its strengths in style and technology to drive high-quality growth. The firm’s analysis underscores the potential for Hyundai India to capitalize on the under-penetrated Indian car market and enhance its profitability through strategic initiatives.
