Analysts discuss trading technique as Hyundai India shares drop more than 6% following a quiet stock market launch.
On the NSE, shares of the South Korean automaker’s Indian division opened at Rs 1,934, down 1.32 percent. Later, the company’s shares fell 6% to Rs 1,842 in the session.
Following a quiet market debut against the issue price of Rs 1,960, Hyundai Motor India Ltd. shares continued to lose more than 6% on October 22.
Hyundai India’s share price dropped 1.47 percent from the issue price on the BSE to Rs 1,931 a share when it was listed on the BSE. The price then recovered somewhat and reached a high of Rs 1,968.80, up 0.44 percent. However, the counter was unable to maintain the trend and fell 6.12% to Rs 1,840 per share on the BSE.
On the NSE, shares of the South Korean automaker’s Indian division opened at Rs 1,934, down 1.32 percent. Later, the company’s shares fell 6% to Rs 1,842 in the session.
At around 2.20 PM, the company’s market valuation on the NSE was Rs 1,50,303.85 crore, down 1986.67 crore from morning session of Rs 1,52,290.52 crore.
“Hyundai Motor India’s solid foundation, as the country’s second-largest passenger car manufacturer, and its strategic focus on the SUV segment continue to support its long-term growth prospects despite the discounted listing,” stated Shivani Nyati, Head of Wealth at Swastika Investmart Ltd.
Long-term investors should think about getting exposure to the stock when it first appears on the exchange, taking advantage of any price movements or fluctuations during its first trading sessions, according to Narendra Solanki, Head of Fundamental Research-Investment Services at Anand Rathi Shares and Stock Brokers, should the market offer a favorable opportunity.
The enthusiasm around the initial public offering (IPO) has subsided in recent months, according to analysts. Being one of the biggest ever, the Hyundai IPO could have put further pressure on market liquidity. Furthermore, its size suggests a greater likelihood of share allocation for individual investors, which has slowed the GMP since the IPO itself seems to be absorbing demand.
Two significant brokerage notes, meantime, have recommended buying the automaker with target prices of more than 20%.
Hyundai Motor India (HMIL) has been set a goal of Rs 2,345 by Motilal Oswal. Nomura has also started a buy call with a Rs 2,472 target price.
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