Tata Motors, one of India’s leading automotive manufacturers, has a long and storied history in the country’s automobile sector, whereas Hyundai, a South Korean multinational, has recently made waves with its record-breaking Initial Public Offering (IPO). Let’s take a comparative look at both companies and their IPO journeys.
Tata Motors: A Legacy of Growth and Innovation
Tata Motors is a subsidiary of the Tata Group, one of India’s largest business conglomerates, and has been a key player in the Indian automotive industry since its inception in 1945 as Tata Engineering and Locomotive Company (TELCO). Initially focused on producing locomotives and engineering products, Tata Motors ventured into commercial vehicles in the 1950s and eventually expanded into passenger vehicles by 1988 with the launch of TataMobile.
Tata Motors launched its IPO in 1980, which was oversubscribed five times, showcasing immense interest from investors. Over the years, Tata Motors expanded its global presence with strategic acquisitions, including the purchase of South Korean truck manufacturer Daewoo Commercial Vehicles in 2004 and the acquisition of Jaguar Land Rover from Ford in 2008. The company has also been a key player in the electric vehicle market, with models like the Nexon EV and Tigor EV.
Hyundai’s Record-Breaking IPO
In stark contrast, Hyundai Motor India, a subsidiary of the South Korean automotive giant Hyundai, recently completed India’s largest IPO to date. The bidding for Hyundai Motor India IPO opened on October 15 and closed on October 17, with an allotment finalised on October 18. Hyundai Motor India shares are set to list on October 22 on both the BSE and NSE.
The Hyundai IPO raised ₹27,870.16 crore at the upper-end price band of ₹1,865 to ₹1,960 per share. The issue was entirely an offer for sale (OFS) of 14.22 crore equity shares. Despite a tepid response from retail investors, with their portion being subscribed 50%, the overall IPO was subscribed 2.37 times, thanks to strong demand from institutional investors.
Comparing the Two IPOs
- IPO Size: Tata Motors’ IPO in 1980 was significantly smaller in scale compared to Hyundai’s 2024 offering. Hyundai’s IPO, raising nearly ₹27,870.16 crore, stands as the largest in India’s history.
- Market Impact: Tata Motors has a long history of being a key player in India’s automotive industry, consistently expanding its product range and venturing into new segments like electric vehicles. Hyundai’s IPO, however, highlights its aggressive growth plans in India, including new product launches and investment in the electric vehicle market with its upcoming all-electric Creta SUV.
- Global Expansion: Both companies have strong international operations. Tata Motors operates across Europe, Africa, and South America, while Hyundai is focusing heavily on India as a strategic growth market, bolstered by its recent IPO.
Future Outlook
Tata Motors has firmly established itself as a key player in the Indian automotive market, with continued growth driven by its electric vehicle offerings and expansion into global markets. Hyundai, on the other hand, is making a strategic play to dominate the Indian market with its electric vehicle line-up and plans for new investments in the country, signaled by the recent record-breaking IPO.
With both companies poised for further growth, Tata Motors and Hyundai represent two automotive giants with different but compelling growth stories in the Indian automotive landscape.
