Hero Motors Eyes Rs 900 Cr IPO – Files with Sebi!

Hero Motors Ltd Sets Stage for IPO

Hero Motors Ltd, a key player in India’s automotive technology sector, has just made a big move. The company, which is part of the Hero Motors Company (HMC) Group, is preparing to launch an Initial Public Offering (IPO) to raise ₹900 crore. This announcement has caught the attention of investors and industry experts alike.

IPO Breakdown: What’s On Offer

The IPO will include a combination of new equity shares and existing shares for sale. The draft red herring prospectus (DRHP) reveals that the offering will consist of fresh equity shares worth ₹500 crore and an Offer-For-Sale (OFS) of ₹400 crore.

The OFS will see shares worth ₹250 crore sold by O P Munjal Holdings. Additionally, Bhagyoday Investments and Hero Cycles will each sell shares worth ₹75 crore.

Moreover, Hero Motors is considering a pre-IPO placement of ₹100 crore. If this placement goes ahead, the fresh issue amount will be adjusted accordingly.

How Hero Motors Plans to Use the Funds

The funds raised from this IPO will be strategically used. Here’s the plan:

• Debt Repayment: ₹202 crore will go towards paying off existing debts, which will help in reducing the company’s financial burden.
• Expansion Investment: ₹124 crore will be used to buy equipment for expanding Hero Motors’ facility in Gautam Buddha Nagar, Uttar Pradesh. This expansion is crucial for the company’s growth and production capabilities.

Hero Motors: A Leader in Automotive Technology

Hero Motors is a name synonymous with cutting-edge automotive technology in India. The company excels in designing, developing, and manufacturing powertrain solutions. Its products cater to a wide range of vehicles, including two-wheelers, e-bikes, off-road vehicles, electric and hybrid cars, and heavy-duty vehicles.

Hero Motors operates across two main segments:

• Powertrain Solutions
• Alloys and Metallics

With six manufacturing facilities in India, the UK, and Thailand, Hero Motors has a significant global footprint. The company’s powertrain solutions are highly engineered and serve prominent automotive original equipment manufacturers (OEMs) in the US, Europe, India, and the ASEAN region.

Financial Highlights

In the fiscal year 2024, Hero Motors reported impressive revenue from operations totaling ₹1,064.4 crore. This strong financial performance underscores the company’s solid market position and growth potential.

Who’s Behind the IPO

Leading the charge for this IPO are three major financial entities: ICICI Securities, DAM Capital Advisors, and JM Financial. These book-running lead managers will play a crucial role in managing and executing the IPO process.

Looking Ahead

The upcoming IPO marks a significant milestone for Hero Motors Ltd. By raising ₹900 crore, the company aims to strengthen its financial position, expand its operations, and continue its growth trajectory. For investors, this IPO presents an opportunity to be part of a leading automotive technology company with a strong track record and promising future.

Stay tuned for more updates as Hero Motors moves forward with its IPO plans.