A bumpy ride

Hyundai listing could be an indicator

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The initial public offering (IPO) of Hyundai Motor India Ltd (HMIL) proved to be a disappointment for primary-market bulls, who have been enjoying an extraordinary run of listing gains for the past two years. The stock listed at a small discount to the IPO price of ₹1,960 and fell further to close the first session at ₹1,811 on the National Stock Exchange. This is in contrast to a situation where the average IPO has been listing with high double-digit or triple-digit gains. Indeed, the HMIL listing may indicate sentiment has normalised from the exuberant bullishness the markets have been witnessing.

The South Korean auto giant had received muted responses to the ₹27,855 crore IPO of its Indian subsidiary. While qualified institutional investors did oversubscribe their quota, the retail segment was undersubscribed and required institutions to bail out the issue, which was subscribed 2.3 times. Again, this is in contrast with recent history, where IPOs have been routinely oversubscribed 10 times