Hero FinCorp, the non-banking financial subsidiary of Hero MotoCorp, has raised ₹260 crore through a pre-IPO placement, strategically reducing the size of its upcoming initial public offering. This move positions the company to launch a ₹3,408.13 crore IPO, slightly lower than the earlier projected ₹3,668.13 crore.
Pre-IPO Placement Attracts Institutional and HNI Investors
On June 5, 2025, Hero FinCorp executed investment agreements with 12 investors, followed by the allotment of 18.57 lakh shares at ₹1,400 per share on June 13. The pre-IPO round reduces the fresh issue component of the IPO to ₹1,840 crore, down from the previously proposed ₹2,100 crore.
Notable participants in the round include:
- Shahi Exports – ₹69 crore
- RVG Jatropha Plantation – ₹50 crore
- Mohan Exports – ₹25 crore
- AP Properties – ₹22 crore
- Vivek Chaand Sehgal, Paramount Products, Tiger Laser Pte, and Virender Uppal – ₹15 crore each
The company clarified that none of the allottees—except Vivek Chaand Sehgal and Laksh Vaaman Sehgal (directors at Motherson Auto)—have any prior association with the promoters or key managerial personnel of Hero FinCorp.
Revised IPO Structure: Fresh Issue + OFS
Following the pre-IPO placement, the total IPO size is now broken into:
- 🔹 Fresh Equity Issue: ₹1,840 crore
- 🔹 Offer for Sale (OFS): ₹1,568.13 crore
The OFS will facilitate partial exits by institutional investors such as:
- AHVF II Holdings Singapore II Pte
- Apis Growth II (Hibiscus) Pte
- Link Investment Trust (represented by Vikas Srivastava)
- Otter Ltd
Strong Fundamentals and IPO Readiness
Founded in 1991, Hero FinCorp has grown into a formidable NBFC catering to retail, MSME, and institutional clients. As of March 2024, the company reported Assets Under Management (AUM) of ₹51,821 crore, with 86% of the portfolio focused on retail and MSME lending.
The IPO proceeds from the fresh issue will be used to boost Tier I capital and support future growth and lending operations.
Regulatory Approval and IPO Management
Hero FinCorp secured the green light from SEBI last month. The IPO will be managed by a consortium of top investment banks, including:
- JM Financial
- Axis Capital
- BofA Securities India
- HDFC Bank
- HSBC Securities
- ICICI Securities
- Jefferies India
- SBI Capital Markets
The company is expected to file its Red Herring Prospectus (RHP) shortly, with market experts anticipating strong investor interest given its robust balance sheet and brand legacy.
