Hero MotoCorp, one of the largest automobile companies in the country, is set to launch an IPO after a long hiatus.
This IPO is expected to be for Hero MotoCorp’s subsidiary and financial service unit, Hero FinCorp. This will be the second IPO for the Hero Group.
Draft to be Filed Next Month
According to a report by ET, preparations are underway for the IPO of Hero MotoCorp’s subsidiary. The draft IPO, or DRHP, is expected to be presented to SEBI next month.
Hero FinCorp’s board approved the IPO proposal this Wednesday, and preparations for filing the draft have intensified. The IPO is estimated to be worth more than Rs 5,000 crore.
Size and Structure of the IPO
Hero FinCorp is a non-banking financial service company offering vehicle finance, personal loans, and business loans.
The company aims to raise between Rs 5,300 crore to Rs 5,500 crore through the proposed IPO. If successful, this will be the largest NBFC IPO in India to date.
The IPO may include both an offer for sale and a fresh issue of shares. The fresh issue could be worth Rs 4,000 crore, while some existing investors might sell shares worth up to Rs 1,500 crore through the offer for sale.
Major Shareholders and Bankers
Hero MotoCorp has appointed ICICI Securities, Bank of America Securities, Jefferies, JM Financial, HSBC Securities, UBS, SBI Capital, and HDFC Bank as bankers for this IPO. Currently, Hero MotoCorp holds the largest stake in Hero FinCorp at 41 percent.
The Munjal family owns 38 percent, with the remaining shares held by investors such as Credit Suisse, Apollo Global, and some Hero MotoCorp dealers.
