The excitement across the IPO market continues to gain momentum. Hero Motors, the auto component business of the Munjal family-led Hero Group, has now got the go-ahead from the market regulator, Securities and Exchange Board of India (SEBI) to launch its much-awaited initial public offering (IPO).
For investors eyeing the auto and manufacturing theme, this issue could be one to watch closely. Let’s take a look at the key factors to watch out for this upcoming IPO –
Hero Motors IPO: Size and structure
Hero Motors plans to raise Rs 1,200 crore through its public issue. The offering will be split into two parts. This includes a fresh issue of Rs 800 crore and an offer for sale (OFS) worth Rs 400 crore.
As per the filing, OP Munjal Holdings will offload shares worth Rs 390 crore, while Bhagyoday Investments and Hero Cycles will sell shares worth Rs 5 crore each.
The company may also consider a pre-IPO placement of up to Rs 160 crore, which could bring down the size of the fresh issue if exercised.
Hero Motors IPO: Fund utilisation
The fresh issue proceeds have been placed for multiple purposes. Around Rs 285 crore will go towards debt repayment. Thereafter, Rs 237 crore will be used to purchase equipment for capacity expansion at the company’s Gautam Buddha Nagar plant in Uttar Pradesh.
Furthermore, the rest will support future acquisitions, growth initiatives, and general corporate needs.
Hero Motors IPO: Who gets what
Hero Motors has structured its IPO allocation as per SEBI’s guidelines.
Breaking it down, 50% of the issue is for qualified institutional buyers (QIBs), 15% for non-institutional investors (NIIs), and 35% for retail investors.
Hero Motors IPO: The lead managers and registrar
Looking at the key players of the issue, the IPO is being managed by ICICI Securities, DAM Capital Advisors, and JM Financial. KFin Technologies acting as the registrar.
About Hero Motors
Led by Pankaj Munjal, cousin of Hero MotoCorp Chairman Pawan Munjal, Hero Motors has built a reputation in the global auto component space.
The company manufactures high-precision engine and transmission parts for two-wheelers.
It is also interesting to note that this is not the company’s first attempt to go public. Hero Motors had initially filed for a Rs 900 crore IPO in August 2024. It later revised its plan and refiled the draft red herring prospectus (DRHP) in July 2025, expanding the issue size to Rs 1,200 crore.