IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Equity Capital Markets

Hyundai Motor India  / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/hyundai-motor-india-ltd" target="_blank" data-smartkarma-citation="entities:40900:1" rel="noopener">Hyundai Motor India (1342Z IN)</a>, a subsidiary of <a href="https://www.smartkarma.com/entities/hyundai-motor-co-44d5ac4e-94e3-4be9-b34f-5f3155e7a3d6" target="_blank" data-smartkarma-citation="entities:26936:1" rel="noopener">Hyundai Motor (005385 KS)</a>, aims to raise up to US$3.0 billion at a valuation of US$17 billion.</li>
<li>In <a href="https://www.smartkarma.com/insights/hyundai-motor-india-ipo-the-bull-case" target="_blank" data-smartkarma-citation="insights:151701" rel="noopener">Hyundai Motor India IPO: The Bull Case</a>, we highlighted the key elements of the bull case. In this note, we outline the bear case.</li>
<li>The bear case rests on market share losses in the key SUV sub-segment, bottom-quartile revenue growth, higher royalty rates and dividends to Hyundai ahead of the IPO.</li>
</ul>



Hyundai Motor India (1342Z IN), a subsidiary of Hyundai Motor (005385 KS), aims to raise up to US$3.0 billion at a valuation of US$17 billion.
In Hyundai Motor India IPO: The Bull Case, we highlighted the key elements of the bull case. In this note, we outline the bear case.
The bear case rests on market share losses in the key SUV sub-segment, bottom-quartile revenue growth, higher royalty rates and dividends to Hyundai ahead of the IPO.


External broker reports(aggregated public sources), HDFC Securities

HDFC Securities

External broker reports(aggregated public sources)

HDFC securities is the best online trading platform for stocks, IPOs, mutual fund in India. 

Content available is external broker reports authored by a third party outside the Smartkarma network and has been aggregated by an online aggregator through publicly available sources and is displayed by Smartkarma in this format for user's convenience and general informational purposes only. Content does not constitute investment or financial advice and Smartkarma makes no representation or warranty regarding its accuracy or contents. Original third party author retains all copyright and other proprietary rights in the content. Access or use of third party links not controlled by Smartkarma are at the user's own risk.

Thematic (Sector/Industry)

<ul><li>The auto sector has outperformed the Nifty Index in Q4, led largely by a sharp rally in some 2W and PV stocks</li><li>We continue to like Maruti Suzuki, and M&amp;M as we expect both of them to continue to outperform the UV segment, which would in turn help improve their performance</li><li>Within 2Ws, we continue to like TVS Motors. We have rolled over the valuation to the year-ended Jun-26.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

The auto sector has outperformed the Nifty Index in Q4, led largely by a sharp rally in some 2W and PV stocksWe continue to like Maruti Suzuki, and M&amp;M as we expect both of them to continue to outperform the UV segment, which would in turn help improve their performanceWithin 2Ws, we continue to like TVS Motors. We have rolled over the valuation to the year-ended Jun-26.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Autos (Q1FY25 Results Preview): 2W to Drive Growth While PVs Ride Pillion

<ul>
<li>
<a href="https://www.smartkarma.com/entities/hyundai-motor-india-ltd" target="_blank" data-smartkarma-citation="entities:40900:1" rel="noopener">Hyundai Motor India (1342Z IN)</a>, a subsidiary of <a href="https://www.smartkarma.com/entities/hyundai-motor-co-44d5ac4e-94e3-4be9-b34f-5f3155e7a3d6" target="_blank" data-smartkarma-citation="entities:26936:1" rel="noopener">Hyundai Motor (005385 KS)</a>, aims to raise up to US$3.0 billion at a valuation of US$17 billion. </li>
<li>HMIL is India's second largest passenger vehicle manufacturer, as measured by domestic passenger vehicle sales. It serves as Hyundai's production and export hub for emerging markets.</li>
<li>The bull case rests on a strong market position, premiumisation-led growth, top-quartile operating and FCF margin profile. </li>
</ul>



Hyundai Motor India (1342Z IN), a subsidiary of Hyundai Motor (005385 KS), aims to raise up to US$3.0 billion at a valuation of US$17 billion. 
HMIL is India's second largest passenger vehicle manufacturer, as measured by domestic passenger vehicle sales. It serves as Hyundai's production and export hub for emerging markets.
The bull case rests on a strong market position, premiumisation-led growth, top-quartile operating and FCF margin profile. 


External broker reports(aggregated public sources), Axis Direct

Axis Direct

Axis Direct is the flagship brand under Axis Securities Limited, a subsidiary of Axis Bank in India. 

Content available is external broker reports authored by a third party outside the Smartkarma network and has been aggregated by an online aggregator through publicly available sources and is displayed by Smartkarma in this format for user's convenience and general informational purposes only. Content does not constitute investment or financial advice and Smartkarma makes no representation or warranty regarding its accuracy or contents. Original third party author retains all copyright and other proprietary rights in the content. Access or use of third party links not controlled by Smartkarma are at the user's own risk.

<ul><li>Auto OEMs: We expect Revenue/EBITDA/PAT for our OEM coverage universe to grow by ~10%/24%/21% YoY along with ~160bps improvement in EBITDA margin.</li><li>The growth will be driven by i) Double-digit volume growth in 2Ws, ii) Mid to high single-digit growth for PVs/CVs partially, which will be offset by iii) Single-digit YoY decline in the tractor volumes respectively.</li><li>The YoY EBITDA margin expansion will be led by a richer product mix, RM softening and price hikes undertaken over the last one year</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Auto OEMs: We expect Revenue/EBITDA/PAT for our OEM coverage universe to grow by ~10%/24%/21% YoY along with ~160bps improvement in EBITDA margin.The growth will be driven by i) Double-digit volume growth in 2Ws, ii) Mid to high single-digit growth for PVs/CVs partially, which will be offset by iii) Single-digit YoY decline in the tractor volumes respectively.The YoY EBITDA margin expansion will be led by a richer product mix, RM softening and price hikes undertaken over the last one yearContent is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Asia Consumer Research, Investory

Devi Subhakesan

Asia Consumer Research

ASIA CONSUMER: INSIGHTS AND INVESTMENT IDEAS

Investory

Investory is a Singapore-based boutique independent equity research firm founded in January 2017 with a primary focus on consumption themes across Asia-Pacific.

We aim to generate investible ideas based on consumption trends and outlook. We screen our ideas on several parameters - product potential, long-term growth and management commitment being the most critical.  We follow a fundamental analysis approach in our stock selection process and are not restricted by market cap.

We aspire to grow into a leading source of unbiased research, free of conflict of interest, for investors yearning for independent and disciplined analysis. 

We also undertake bespoke research mandates to support our Institutional clients’ investment needs.

Our team comprises of professionals with extensive experience in the Asian equity markets, in areas ranging from research, servicing institutional clients and investment management.

<ul>
<li>Hyundai Motor India (HMIL) saw a market share loss in India Passenger Vehicles sales reported for June 2024 and 1QFY2025, impacted by intensified competition in the SUV segment.</li>
<li>Mahindra &amp; Mahindra, and Toyota Kirloskar India gained market share in 1QFY2025 led by upgraded model launches in the SUV segment, traditionally a strong category for HMIL.</li>
<li>HMIL's declining market share, if not reversed soon, could challenge optimistic growth projections and valuation multiples for its upcoming IPO.</li>
</ul>


Hyundai Motor India (HMIL) saw a market share loss in India Passenger Vehicles sales reported for June 2024 and 1QFY2025, impacted by intensified competition in the SUV segment.
Mahindra &amp; Mahindra, and Toyota Kirloskar India gained market share in 1QFY2025 led by upgraded model launches in the SUV segment, traditionally a strong category for HMIL.
HMIL's declining market share, if not reversed soon, could challenge optimistic growth projections and valuation multiples for its upcoming IPO.


India Car Sales Slow: Can Hyundai Keep Its No. 2 Spot Amidst Fierce Competition?

India

Tata Motors Limited manufactures cars and commercial automotive vehicles in India. The Company designs, manufactures and sells heavy commercial, medium commercial and small commercial vehicles including trucks, tankers, vans, buses, ambulances and minibuses. Tata also manufactures small cars and sports utility vehicles.

Maruti Suzuki India Limited manufactures and exports automobiles. Maruti collaborated with Suzuki of Japan to produce affordable cars for the average Indian.

Hero MotoCorp Ltd. designs, manufactures and distributes motorcycles. The Company's products also include motorcycle parts and accessories.

Bajaj Auto Limited manufactures and distributes motorized two-wheeled and three-wheeled scooters, motorcycles and mopeds.

TVS Motor Company Limited manufactures motorcycles, mopeds, and scooters. The Company provides spark ignition operated outboard motors, combustion spark ignition engines, critical engines, and transmission parts. TVS Motor Company serves customers in India.

Eicher Motors Ltd. manufactures light commercial vehicles which are sold domestically and are also exported to other countries. Eicher Motors also manufactures two-wheelers and automotive gears.

Maharashtra Scooters Ltd. manufactures and distributes two-wheeler scooters.

Atul Auto Ltd. manufactures three-wheeled commercial diesel vehicles.

Bosch Limited manufactures a wide range of automotive parts. The Company'products includes fuel injection pumps, spark plugs, including nozzles and nozzle holders, elements, delivery valves, filters and filter inserts, glow plugs, starter motors, alternators and wipers. Bosch also manufactures hydraulics and pneumatic equipment and electric power tools and fixtures.

Samvardhana Motherson International Limited manufactures and distributes automotive parts. The Company offers products such as HVAC systems, air intake manifolds, highway vehicle cabins, air compressors, and pedal box assembly. Samvardhana Motherson International markets its products worldwide.

Samvardhana Motherson International Ltd (MOTHERSO IN)

PT Astra International Tbk assembles and distributes automobiles, motorcycles, and their related spare parts.  Through its subsidiaries, the Company also operates in the mining, development of plantations, financial and information technology.

NISSAN MOTOR CO., LTD. manufactures and distributes automobiles and related parts. It also provides financing services. Nissan delivers a comprehensive range of products under various brands. The Company manufactures in Japan, the United States, Mexico, the United Kingdom and many other countries.

Geely Automobile Holdings Limited operates as a passenger vehicles manufacturing company. The Company provides passenger vehicles development, manufacturing, sales, and other services. Geely Automobile Holdings also exports passenger vehicles.

Great Wall Motor Company Limited, through its subsidiaries, manufactures and sells pick-up trucks and sport-utility vehicles (SUVs) in China under branded names. The Company also researches and develops, and manufactures principal automotive parts and components for use in the assembly of pick-up trucks and SUVs.

Honda Motor Co., Ltd. develops, manufactures, and distributes motorcycles, automobiles, and power products such as generators and farm machinery. The Company also operates a financial credit business. Honda Motor has manufacturing facilities in the US, Canada, the UK, France, Italy, Spain, Brazil, Mexico, India, and Thailand.

Hyundai Motor Company manufactures, sells, and exports passenger cars, trucks, and commercial vehicles. The Company also sells various auto parts and operates auto repair service centers throughout South Korea. Hyundai Motor provides financial services through its subsidiaries.

Kia Corporation manufactures, sells, and exports passenger cars, mini-buses, trucks and commercial vehicles. The Company also manufactures auto-parts and tools using hybrid electric and fuel cell technology. Kia markets its products worldwide.

Suzuki Motor Corporation manufactures automobiles, motorcycles, and their related parts. The Company has production facilities in USA, Japan, Taiwan, India, Pakistan, Indonesia, Thailand, and Hungary.

Stellantis NV manufactures and markets automobiles and commercial vehicles. The Company also produces metallurgical products and production systems for the automobile industry, as well as owns publishing and insurance companies. Stellantis serves customers worldwide.

Subaru Corp manufactures passenger cars, buses, motor vehicle parts, and industrial machinery.  The Company also produces aircraft parts and supplies it to defense agency and Boeing Co.  The Company sells its passenger cars under the Subaru brand name.

Mahindra & Mahindra Ltd. manufactures automobiles, farm equipment and automotive components. The Company's automobile products include light, medium and heavy commercial vehicles, jeep type vehicles and passenger cars. Mahindra & Mahindra also manufactures agricultural tractors, agricultural implements, internal combustion engines, industrial petrol engines, spare parts and machine tools.

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Mahindra & Mahindra (MM IN)

Hyundai Motor India IPO: The Bear Case

The bear case rests on market share losses in the key SUV sub-segment, bottom-quartile revenue growth, higher royalty rates and dividends to...

Arun George

Autos (Q1FY25 Results Preview): 2W to Drive Growth While PVs Ride Pillion

We continue to like Maruti Suzuki, and M&M as we expect both of them to continue to outperform the UV segment, which would in turn help improve...

HDFC Securities

Hyundai Motor India IPO: The Bull Case

The bull case rests on a strong market position, premiumisation-led growth, top-quartile operating and FCF margin profile.

Arun George

Q1FY25 Earnings Preview - Automobile

Auto OEMs: We expect Revenue/EBITDA/PAT for our OEM coverage universe to grow by ~10%/24%/21% YoY along with ~160bps improvement in EBITDA margin.

Axis Direct

India Car Sales Slow: Can Hyundai Keep Its No. 2 Spot Amidst Fierce Competition?

Justifying premium valuations for the upcoming IPO will be challenging if Hyundai Motors India fails to reverse its declining market share in...

Devi Subhakesan

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