Hyundai to sell 24 pc stake of Indian arm

Hyundai to sell 24 pc stake of Indian arm
ENS Economic Bureau

New Delhi, Feb 1: Hyundai Motor Corporation of South Korea has decided to privately place up to 24 per cent stake in its Indian subsidiary Hyundai Motor India Limited (HMIL) this calendar year. HMIL has, however, not finalised the exact time-frame for the divestment, the company director (Marketing and Sales), B V R Subbu, told newspersons here today. The company had also posted a net profit of over Rs 20 crore in calendar 1999, Subbu said.

The company is evaluating the share price and will sell the stake to the highest bidder. ``We will sell this stake to raise money for our expansion plans. We need to launch Sonata and Sportage. The Indian customer needs that variety,'' Subbu said. The money raised through this private placement of shares will be used to expand capacity in order to bring in the two new models in the near future. While Sportage is a sports utility vehicle, Sonata is a luxury sedan.

HMIL's equity base is around Rs 800 crore. ``We have placed an upper limit of 24 per cent for thesell-off. We might begin with five or six per cent initially and gradually achieve the total limit,'' Subbu said.

Meanwhile, HMIL sold 8,645 units of passenger cars in January this year, including 7,402 units of Santro and 1,243 units of Accent. Last year, the company had sold 2,753 units of the Santro in January. The cumulative sales achieved by the company has this crossed the 75,000-mark in 15 months.

The company has so far sold around 60,675 units of the Santro in the current fiscal and hopes to sell another 15,000 units of both the Santro and the Accent in the current fiscal. For this calendar year, the company has set a target of 66,000 for the Santro and another 12,000 for Accent. The company plans to operate in three shifts from April at its plant near Chennai. The company has set an export target of 10,000 units of CBUs for calendar 2000. The company has already begun exporting to Nepal and sees Sri Lanka, Bangladesh, Middle East and South East Asia as potential markets. In calendar 1999, HMIL'sexports were worth around Rs 50 crore.