India’s automotive major Hero Motors has joined the IPO race as the company has announced its initial public offering of Rs 1,000 crore. The offer will open for bidding on September 15, and its issue price band is fixed at Rs 79 to Rs 84 per share.
Of the total float, the company will raise Rs 600 crore through the issuance of 7.14 crore equity shares, while promoter group will offload 4.56 crore shares aggregating Rs 400 crore through the offer for sale route.
While markets highly anticipate this issue, participants should monitor in case they wish to apply for the same:
High revenue generation from ten clients
Over the past three fiscal years, the company has generated more than 70% of its revenue from its top ten customers. Of these, the top five customers contributed over 60% of the total revenue, and the company’s top customer added over 30% to the topline.
Loss of contracts may significantly impact the company’s financial condition and adversely affect its cash flow operations.
Losses in subsidiaries over the past year
In FY26, Hero Motor’s six subsidiaries: Hero Motors Thai HYM Drive Systems Private Limited, Spur Technologies Private, Hero EDU Systems Private, Hewland Engineering, and Munjal STP Industries Private Limited incurred heavy losses.
The company, in its draft red heering prospectus mentioned that no assurance can be given on their profitability and whether they’ll benefit from the funds infused in these subsidiaries.
Pending proceedings against promoter group
Seventeen regulatory proceedings are pending against the company, while one material civil litigation is pending against its directors. Additionally, one tax proceedings is also pending against its susdiaries.
According to its DRHP, such proceedings could divert the company’s financial resources in their defence and prosecution, and the amount in these proceedings has not been disclosed yet. Any adverse decision in such a case may have an adverse effect on its business and financial conditions.
Promoter entity under corporate insolvency resolution
Hero Motor’s promoter entity, Nipman Fastener Industries Private, is currently under the corporate insolvency resolution process under liquidation under the Insolvency and Bankruptcy Code, 2016.
Also, a case of insolvency has been initiated against one of the promoter group members, Priyanka Malhotra, under the same act.
Dependence on limited number of suppliers
As of March 31, 2026, the company had 471 suppliers for meeting its raw material requirements. Of these, the top ten suppliers accounted for 20% of the total expenses incurred in FY26, while the top supplier comprises 3% of the total expenses.
With heavy reliance on a limited number of suppliers, the auto company’s business stands vulnerable to risks associated with supply chain management, as it does not have definitive supply agreements with all its suppliers.
Hero Motors IPO: Subscription timeline
The company’s IPO will open for anchor bidding on September 15, and for public bidding on September 16. It will close its bidding window on September 18. Its share allotment is expected to be completed by September 21.
Bidders are likely to receive their refunds and shares by September 22, and Hero Motors is expected to debut on the bourses on September 23.
Investors who wish to participate can bid in lots of 178 shares and thereafter. ICICI Securities, DAM Capital Advisors, and JM Financial are the merchant bankers of the IPO, while KFin Technologies is the registrar to the issue.