Hero Motors Gets SEBI Nod for ₹1,200 Crore IPO

Hero Motors Limited has received the Securities and Exchange Board of India’s (SEBI) approval to launch its maiden initial public offering (IPO). The auto components maker plans to raise ₹1,200 crore through a mix of fresh issue and offer for sale (OFS), as per the markets regulator’s update on September 15, 2025.

IPO Structure and Allocation

The ₹1,200 crore issue comprises a fresh issue of ₹800 crore and an OFS of ₹400 crore. The OFS will see OP Munjal Holdings offload ₹390 crore worth of shares, while Bhagyoday Investments and Hero Cycles will sell ₹5 crore each.

The IPO, with a face value of ₹10 per equity share, will allocate:

• 50% to qualified institutional buyers (QIBs)
• 15% to non-institutional investors (NIIs)
• 35% to retail investors

Hero Motors also has the option of a pre-IPO placement of up to ₹160 crore, which would reduce the fresh issue size accordingly.

Utilisation of Fresh Issue Proceeds

The company plans to utilise the ₹800 crore fresh issue for multiple purposes:

• ₹285 crore for debt repayment
• ₹237 crore for capital expenditure, including equipment purchases at its Gautam Buddha Nagar facility
• Funding potential acquisitions
• General corporate purposes

Lead Managers and Registrar

ICICI Securities, DAM Capital Advisors, and JM Financial have been appointed as the book-running lead managers for the IPO. KFin Technologies will act as the registrar.

Company Background and Operations

Led by Pankaj Munjal, cousin of Hero MotoCorp Chairman Pawan Munjal, Hero Motors had initially filed for a ₹900-crore IPO in August 2024. The company later refiled its Draft Red Herring Prospectus (DRHP) in July 2025, expanding the issue size to ₹1,200 crore.

As of December 31, 2024, Hero Motors operated six manufacturing facilities across India, the UK, and Thailand. The company focuses on engine and transmission components for two-wheelers and has global clients such as BMW, Ducati, and Harley-Davidson.

Currently, promoters hold a 91.65% stake in the company.

Read More: Electric motorcycle maker Ultraviolette raises $21 mn in funding round

Conclusion

With SEBI approval in place, Hero Motors is set to move forward with its maiden IPO, aimed at strengthening its balance sheet, funding expansion, and enhancing competitiveness. The offering also provides an exit opportunity to existing investors through the OFS component.

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