Hyundai Motor India's $3.3 billion IPO was 18% subscribed on the first day of bidding on Tuesday, led by employees who placed orders for four-fifths of the shares reserved for them in the country's largest share sale yet.

The three-day share sale, the first by an automaker in India in two decades, ends on Thursday. Prior to the open bidding process, institutional investors including BlackRock and Fidelity on Monday snapped up shares worth $989.4 million as part of the offering.

The initial public offering (IPO) marks Hyundai Motor's first such listing outside South Korea and comes at a time when companies are rushing to go public in an Indian equities market that has risen to record highs.

Over 260 companies in India have raised more than $9 billion through IPOs so far this year, according to LSEG data. That's already higher than the $7.42 billion raised during the same period last year.

The share sale is the world's second-largest IPO this year following Lineage Inc's $5.1 billion U.S. flotation in July.

Employees of Hyundai India bid for 80% of the 778,400 shares reserved for them, exchange data showed.

The company had offered a discount of 186 rupees per share to eligible employees in the IPO, which was priced at 1,865-1,960 rupees per share, months after hundreds of workers at the company's main Indian plant at Sriperumbudur near Chennai protested to demand a share allocation.

Qualified institutional buyers including foreign investors, banks and mutual funds subscribed to 5% of the shares allotted for them, while retail investors bid for 26% of their allocated shares.

Hyundai India is targeting a $19 billion market valuation at the upper-end of the IPO price band. That values the company at about 40% of its Korean parent.

Its shares are expected to start trading on Oct. 22.

Hyundai is India's No. 2 carmaker by sales with about a 15% share of the country's passenger vehicle market and trails only Maruti Suzuki.

However, a rapidly changing competitive landscape has seen domestic rivals Tata Motors and Mahindra & Mahindra eat into the South Korean company's market share with new SUVs that are gaining popularity.

Higher production capacity would help Hyundai bridge the gap with Maruti Suzuki and extend its narrow lead over Tata and Mahindra. ($1 = 84.0600 Indian rupees)

(Reporting by Chris Thomas and Nandan Mandayam in Bengaluru; Editing by Christian Schmollinger and Mark Potter)