Ahead of the listing today, Macquarie has initiated coverage on Hyundai Motor India with an ‘Outperform’ rating and a target price of ₹2235, suggesting a 14% upside to the issue price’s upper band. This recent endorsement adds to the positive sentiment surrounding Hyundai’s upcoming listing.
Key Insights from Macquarie’s Report:
Premium Positioning: Macquarie believes that Hyundai Motor India deserves to trade at a premium price-to-earnings (PE) multiple compared to its peers due to its favorable portfolio mix and strong premium positioning in the market.
Powertrain Optionality: The report highlights the potential advantages from Hyundai’s powertrain capabilities, supported by its parent company. This includes market share upside risk from new models and powertrain launches, seen as medium-term positives.
Target Price and Outlook: Initiating coverage at ‘Outperform’, Macquarie has set a target price of ₹2235. This valuation reflects a 14% potential upside, underscoring their confidence in Hyundai’s growth trajectory and market positioning.
Earlier, Nomura initiated coverage on Hyundai Motor India with a ‘Buy’ rating and a higher target price of ₹2472. Nomura’s analysis pointed to:
Volume Growth: An 8% volume CAGR over FY25-27, driven by the introduction of 7-8 new models.
EBITDA Margins: Improvement from 13.1% in FY24 to 14% by FY27, facilitated by a better product mix and cost reduction measures.
Earnings CAGR: A projected 17% earnings CAGR over FY25-27, reflecting high-quality growth prospects.
