Hyundai Motor Shares Surge to New High on Strong India Sales; RBI Liquidity Push Lifts Auto Stocks
The Indian auto industry has seen a major boost, with Hyundai Motor India (HMIL) shares reaching an all-time high amid wider advances for the NIFTY AUTO index today. Underlying this major market action is a twin driver: a major liquidity injection by the Reserve Bank of India (RBI) and strong operational performance figures, especially from Hyundai, that have combined to lend additional strength to investor sentiment.
Shares of Hyundai Motor India Ltd (HMIL), which got listed on the stock exchanges last year, jumped as much as 6.64% in early trade on Monday, June 9, touching a record high of ₹1,984.80 on the NSE.
RBI's Monetary Policy: A Driver of Market Liquidity
The main macroeconomic driver of the rally in car stocks, and indeed the broader market, lies in the Reserve Bank of India's monetary policy announcement, which came last Friday, June 6. The Reserve Bank of India's Monetary Policy Committee (MPC), after its June 4-6 meeting, decided to enact a 50 basis points (bps) reduction in the repo rate to 5.5%. This step is aimed at bringing down the cost of borrowing in the financial system as a whole, thus leading to credit supply and investment stimulation.
Adding to the liquidity injection, the MPC also decided to lower the cash reserve ratio (CRR) to 3% from its current 4%, a whopping 100 bps cut. The CRR is the proportion of total deposits that an individual bank should keep in liquid cash form to have risk-free operations. A decrease in the CRR means greater liquidity in the system that allows commercial banks to have greater funds on hand for lending.
RBI Governor Sanjay Malhotra, in his speech on Friday, 6 June, assured that this cut in CRR would be done in stages, finally releasing an estimated ₹2.5 lakh crore of bank funds to the financial system, with the last tranche finishing by 29 November 2025. It is worth mentioning here that the previous similar 1% CRR reduction was done on 27 March 2020 as an off-policy step to help the economy in the early stage of the COVID-19 pandemic.
The RBI’s rate cut is expected to boost auto demand by reducing vehicle loan interest rates, making Hyundai’s offerings more affordable for consumers. Improved liquidity and buyer sentiment could further support sales momentum, particularly in entry-level and SUV segments.
Hyundai Motor India: Operational Strength and Strategic Vision
Apart from the systemic liquidity of the RBI, certain company-specific developments have significantly strengthened investor confidence in Hyundai Motor India. Stocks of HMIL, which debuted on stock markets a year ago, jumped as high as 6.64% to reach an all-time high of ₹1,984.80 per share on the NSE in the initial transactions on Monday, June 9. The stock was later trading at ₹1,941.90, a 4.34% gain. During the initial trade, Hyundai Motor India stocks had already jumped 5%, reaching a high of ₹1,937.40.
This impressive share performance is primarily underpinned by Hyundai’s strong May 2025 performance in domestic passenger vehicle (PV) sales. The company successfully reclaimed the third position in the Indian PV market, recording 43,861 unit sales and notably surpassing Tata Motors' 41,557 units. This achievement marked a reversal of a three-month trend during which Hyundai had trailed Tata Motors.
When including exports, Hyundai comfortably remains No. 2 overall in India, with overall passenger vehicle (PV) sales of 58,701 units in May, easily ahead of Mahindra's 54,819 units.
Added to the optimistic investor sentiment are Hyundai's strategic investments. Hyundai recently invested ₹16.58 crore as the first tranche towards a 26.13% stake in FPEL TN Wind Farm Private Limited. This investment is a part of Hyundai's green energy roadmap for the automotive industry globally, with a target to minimise carbon emissions and promote the use of renewable energy sources in its manufacturing process.
Hyundai has also reaffirmed its strategic commitment to making India its largest overseas export base outside South Korea, expecting healthy single-digit growth in foreign volumes this fiscal year. These encouraging developments, including enhanced market positioning and aggressive strategic investments, have sufficiently boosted investor confidence.
Wider Automotive Industry Performance
The upbeat market mood was not restricted to Hyundai only. The other auto stocks, too, were trading with a gain, an indication of a wider sectoral momentum. The NIFTY AUTO index, last seen, was quoting 0.85% higher at 23,863.20 levels. Significant to note was that 14 out of its 15 constituents were trading in the green. Under the auto index, the largest gainer was Tata Motors with an increase of 1.34%, followed by Motherson, Exide Industries, Maruti Suzuki India (MSIL), and MRF. It's worth mentioning that Hyundai Motors is not yet a part of the NIFTY AUTO index.
The collective impact of a decisive injection of liquidity by the RBI and the excellent operational performance and strategic metrics of top carmakers, led by Hyundai, would seem to have clearly propelled the aggressive performance witnessed throughout the Indian auto industry today.
Hyundai Motor Company (HYMTF) stock is trading at around $54.00 per share on the OTC market, up about 0.75% from the previous close.
Meanwhile, as of 10.40 AM, Hyundai Motor India shares are trading near ₹1,966.20, up over 5.6%.
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