EghtesadOnline: Owning a 3.4% share of Iran’s auto market, the country’s second-largest private automotive company Kerman Khodro has acquired the required permits for launching an initial public offering on Iran Fara Bourse.
According to the official website of Fara Bourse, the IPO permit was issued on July 11, which will eventually grant the public access to the company’s shares.
Furthermore, henceforth financial reports and related documents of Kerman Khodro Industrial Group will be available on codal.ir, a website backed by the Securities and Exchange Organization.
According to codal.ir, the nominal price for each share is 1,000 rials, however, the company is yet to determine how much of the company is to go public. An informed source speaking to Financial Tribune on condition of anonymity said that the final IPO price for Kerman Khodro shares are yet to be determined, Financial Tribune reported.
Kerman Khodro through its various subsidiaries has forged automotive ties with companies from China and South Korea.
Under a joint venture deal signed in March 2017, Kerman Motor started production of three Hyundai models namely i10, i20 and Accent. Another model dubbed ‘Elantra’ was set to join the collection with plenty of preorders placed; however, complications imposed on Iran’s automotive sector by the US underhand move to unilaterally back out of Iran’s historic nuclear deal and reimpose sanctions against Iran prevented Kerman Khodro to uphold its commitments to customers and resulted in the offering of reimbursement packages.
US President Donald Trump’s decision to pull the US out of the Iran nuclear deal and reinstate penalties against Tehran compelled several foreign automakers to suspend their cooperation with Iranian firms. Seoul-based Hyundai also seems to have decided to toe the line and suspend its operations in Iran—a policy leading to problems in producing the already submitted orders since the Korean counterparts have not upheld their end of the bargain in delivering auto parts.
Kerman Khodro’s subsidiaries have developed relations with five Chinese carmakers namely, BYD, Geely, Hawtai, JAC and Lifan.
The firm’s collaborations with Hawtai kicked in earlier in March and test production of Hawtai A25 was launched in Iran.
While Kerman Khodro’s collaborations with Hyundai have hit a bumpy road, the company has pushed ahead with plans to expand its ties with Chinese makers. The market is yet to react to the company’s IPO.