Hyundai Motor India Receives ₹17.5 Crore GST Notices; Stock Drops 7% in Five Sessions
Hyundai Motor India Limited (HMIL), the Indian subsidiary of the South Korean automobile giant Hyundai, has received Goods and Services Tax (GST) notices amounting to nearly ₹17.5 crore from the governments of Tamil Nadu and Maharashtra. The development has put the automaker under regulatory scrutiny, even as the company assures investors that the notices will not impact its operations.
Meanwhile, Hyundai Motor India’s stock has been under pressure, witnessing a decline of over 7% in the last five trading sessions.
Breakdown of GST Notices
In an exchange filing on February 28, Hyundai Motor India disclosed that it has received two separate GST notices:
- Maharashtra State Tax Department:
- GST Demand: ₹2.51 crore
- Penalty: ₹35.15 lakh
- Interest: Applicable interest charges
- Total Amount Payable: ₹2.76 crore
- Tamil Nadu Central GST Department:
- GST Demand: ₹13.46 crore
- Penalty: ₹1.34 crore
- Interest: Applicable interest charges
- Total Amount Payable: ₹14.8 crore
The combined liability from both notices stands at ₹17.5 crore. However, Hyundai Motor India has clarified that these tax demands will not impact its financial stability, business operations, or long-term growth strategy.
Hyundai Motor India Share Performance
The news of the tax demand has coincided with a downward trend in Hyundai Motor India’s stock price. The stock closed 0.28% higher at ₹1,729.50 on February 28, but it has lost 7.32% in the last five sessions.
Stock Market Overview
| Metric | Value |
|---|---|
| Closing Price (Feb 28, 2025) | ₹1,729.50 |
| Previous Close | ₹1,724.75 |
| 5-Day Change | -7.32% |
| YTD Performance (2025) | -3.76% |
| Since Listing (Oct 2024) | -6.20% |
| 52-Week High | ₹1,968.80 (Dec 22, 2024) |
| 52-Week Low | ₹1,610.15 (Jan 29, 2025) |
| Market Capitalization (Feb 28, 2025) | ₹1.40 lakh crore |
The stock is still significantly below its peak of ₹1,968.80, recorded in December 2024, raising investor concerns about its near-term performance.
Hyundai India’s Sales Performance
Despite the recent regulatory issues, Hyundai India continues to report steady sales growth.
- February 2025 Sales: 58,727 units (6.8% YoY increase)
- Domestic and Export Growth: Increased demand in both domestic and international markets
- Company’s Statement: Tarun Garg, the Whole-Time Director & COO, stated that Hyundai’s export growth reflects strong global demand for its Made-in-India vehicles.
Financial Ratios & Performance Metrics
| Financial Metric | Value |
|---|---|
| Revenue Growth (YoY) | +6.8% |
| Net Profit Margin | 8.5% |
| Earnings Per Share (EPS) | ₹28.50 |
| Price-to-Earnings (P/E) Ratio | 14.2x |
| Return on Equity (ROE) | 15.6% |
| Debt-to-Equity Ratio | 0.42 |
Hyundai India has maintained a strong financial position with a healthy profit margin and sustainable debt levels. The company’s return on equity (ROE) remains strong, suggesting efficient capital utilization.
Investor Takeaways
- Short-Term Pressure on Stock Price: The stock has seen a recent decline, but long-term fundamentals remain intact.
- Regulatory Scrutiny Not a Major Concern: Hyundai Motor India has assured stakeholders that the tax notices will not impact operations.
- Consistent Sales Growth: With rising domestic and export demand, Hyundai continues to strengthen its market position.
Conclusion
While the ₹17.5 crore GST notices have raised concerns, Hyundai Motor India remains financially stable and operationally strong. The company’s ability to grow sales despite regulatory headwinds is a positive sign. However, short-term market fluctuations could persist, requiring investors to closely monitor further developments.
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Disclaimer: This blog post is for informational purposes only and should not be considered financial advice. Investors should conduct thorough research and consult with a qualified financial advisor before making any investment decisions.