Hyundai IPO opens today; GMP falls under 3%: Should you buy or not?

Hyundai Motor IPO :  much-anticipated initial public offering ( IPO ) of Hyundai Motor India (HMIL) is set to open for bidding on Tuesday, October 15. Valued at Rs 27,856 crore, it marks largest IPO in Indian stock market history. 

issue price is set between Rs 1,865 and Rs 1,960 per share, with a minimum lot size of seven shares. bidding window will remain open until Thursday, October 19.

IPO is first from an Indian car manufacturer since Maruti Suzuki 's in 2003. Hyundai's South Korean parent, Hyundai Motor Company, has waited more than two deces to bring this offer to Indian market. It is an entirely "offer for sale" (OFS) issue, with up to 14.21 crore equity shares on offer, leing to a market capitalisation of approximately Rs 1.6 lakh crore.

Despite initial enthusiasm, Hyundai's grey market premium (GMP) has been on a stey decline. Recently, GMP was Rs 65 per share, signalling a modest 3 per cent potential listing gain for investors at higher end of price band. GMP h been much higher, with quotes of Rs 150-175 per share before weekend, but it plummeted to two-digit figures over last few days. Earlier in October, GMP h even touched Rs 500, and around Rs 350-375 when issue was officially announced.

While some market experts feel IPO is fairly priced, y believe it could yield solid long-term returns, thanks to Hyundai's established track record. However, all-OFS nature of offering has raised concerns, as all proceeds from sale will flow to parent company in South Korea, leaving Indian subsidiary without financial benefits. 

high valuations and OFS structure have left investors cautious, particularly amid broer market volatility. re is also concern about liquidity being drained from Indian market due to large size of issue.

Considering falling GMP and structure of IPO , potential investors are vised to carefully weigh short-term risks against possibility of long-term gains before making a decision.