A thriving stock market in the world's fifth-largest economy has stoked an IPO surge over the last two years, with start-ups and established companies alike raising billions of dollars from investors.

The IPO had valued Hyundai's India unit, the country's second-largest carmaker by sales, at about $19 billion, with the South Korean parent firm putting up a 17.5 percent stake for purchase.

Shares of the automaker fell in the first morning of trade to 1,870 rupees ($22.34), down more than 4.5 percent from their issue price of 1,960 rupees.

"Our journey in India began in 1996... and now, 28 years later, we are going public by launching India's largest IPO in history," Hyundai Motor Group executive chair Euisun Chung said at the listing ceremony in Mumbai.

"From the beginning, we knew that India was the future", he added. "Today's IPO... demonstrates our commitment to this great nation".

While shares in Hyundai Motor India's IPO were oversubscribed more than two times, retail investors snapped up only half the tranche reserved for them.