Hyundai Motor India Gets 'Overweight' Rating As JPMorgan Initiates Coverage, Sees 17% Upside

Hyundai Motor India Ltd. received an 'overweight' rating as JPMorgan Chase & Co. initiated coverage on the stock, citing premium portfolio and passenger growth tailwinds in the country.

Target price of the recently listed Indian unit of Korea's Hyundai Motor Group is Rs 2,200 per share, implying an upside of 17% from Tuesday's close.

A premium portfolio mix, with 68% sport utility vehicle, drives higher per-unit profitability, JPMorgan said, adding that there could be potential market-share tailwinds in the second half of the next financial year, led by new capacity and models.

The car maker's focus on capex efficiency, utilisations and the current export contribution are among the other key positives for the brokerage, after the company's debut on the national bourses last month. "Export contribution provides a cushion against domestic cyclicality."

However, JPMorgan expects domestic passenger vehicle industry growth to remain muted for a few quarters, with a cyclical recovery starting in second half of fiscal 2026.

India's second-largest passenger car maker should see its market share rising from the current 14% to 15% in fiscal 2027, led by the launch of new models, analysts at the brokerage firm said in a note.

Further, "despite an increase in Hyundai Motor royalty in the next fiscal, we expect the premium to continue at 25-30%."

After raising Rs 27,870 crore in its initial public offering—India's biggest so far—shares of the automaker debuted at a discount of 1.5%.

The maiden IPO of the India unit was subscribed 2.37 times, with bids led by qualified institutional buyers. The company had set a price band of Rs 1,865–1,960 per share, which was a pure offer for sale of 14.2 crore shares.

Since its listing on the street on Oct. 22, the stock has risen by 3.3% while the benchmark NSE Nifty 50 has fallen by 1.13%, amid a broader decline in the market led by foreign exodus.

Of the 11 analysts tracking the automaker, nine have a 'buy' rating on the stock, and two have a 'sell', according to Bloomberg data. The average of 12-month analysts' price target implies a potential upside of 15%.