Hero Motors, part of the Hero Motors Company (HMC) Group, is preparing to go public. The company has submitted its draft red herring prospectus (DRHP) to the Securities and Exchange Board of India (SEBI) to raise ₹900 crore through an initial public offering (IPO), according to a filing on August 23.
The IPO will include a fresh equity issuance of ₹500 crore and an offer-for-sale (OFS) of ₹400 crore worth of shares by the company’s promoters. OP Munjal Holdings will sell shares worth ₹250 crore, while Bhagyoday Investments and Hero Cycles will each offload shares worth ₹75 crore.
Before filing the final prospectus, Hero Motors may also raise ₹100 crore through a pre-IPO placement. If this happens, it will reduce the amount allocated for general corporate purposes from the fresh issue.
The promoters of Hero Motors are OP Munjal Holdings with a 71.55% stake, Bhagyoday Investments with 6.28%, and Hero Cycles with 2.03%. Investor South Asia Growth Invest LLC holds 12.27% of the company.
Hero Motors provides powertrain solutions, including both electric and non-electric systems, to automotive manufacturers worldwide. Their customers include BMW, Ducati, and Enviolo, among others. The company operates in India, the UK, and Thailand, with six manufacturing facilities.
For the fiscal year ending March 2024, Hero Motors reported a net profit of ₹17 crore, down 58% from ₹40.5 crore the previous year. Revenue grew slightly by 0.9% to ₹1,064.4 crore, but EBITDA fell by 23.7% to ₹63.8 crore.
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