In a strategic move ahead of its much-anticipated IPO, Hero FinCorp, the non-banking finance arm backed by Hero MotoCorp and the Munjal family, has raised ₹259.99 crore through a pre-IPO placement. This fundraising effort has led to a revision in the company’s IPO structure, trimming the fresh issue size while retaining investor confidence in its financial trajectory.
The company allotted 18.57 lakh equity shares at ₹1,400 each to a set of 12 institutional and private investors. The list includes well-known names such as Shahi Exports (₹69 crore), RVG Jatropha Plantation (₹50 crore), Mohan Exports (₹25 crore), and AP Properties (₹22 crore), among others.
As a result of this pre-IPO capital infusion, Hero FinCorp has revised the size of its fresh issue from ₹2,100 crore to ₹1,840 crore. The offer-for-sale (OFS) portion remains unchanged at ₹1,568.13 crore, bringing the total issue size down to ₹3,408.13 crore from the earlier ₹3,668.13 crore.
The IPO, which has already received SEBI’s nod on May 22, is expected to hit the market in the coming weeks. The proceeds from the fresh issue will be used to strengthen Hero FinCorp’s Tier-I capital base, enabling the company to expand its lending capacity across retail, MSME, and corporate sectors.
Hero FinCorp has shown strong growth over the past three years. Its Assets Under Management (AUM) stood at ₹51,820.8 crore as of March 2024. The NBFC’s revenue for FY24 was ₹7,479.4 crore, up from ₹5,719.6 crore in FY23, while its net profit rose to ₹637 crore in FY24 from ₹479.9 crore in the previous fiscal year. Retail and MSME lending now account for over 85% of its total loan book.
Despite positive growth, the company reported gross non-performing assets (GNPA) of 4.02% and net NPAs of 2% as of March 2024. The company also witnessed a rise in write-offs, amounting to ₹2,180.9 crore in Q1 FY25, up 80% year-on-year—a trend it attributes to aggressive provisioning and portfolio cleaning.
Hero FinCorp’s IPO will be managed by leading investment banks including JM Financial, Axis Capital, BofA Securities, HDFC Bank, HSBC, ICICI Securities, Jefferies India, and SBI Capital Markets. The company plans to list on both NSE and BSE.
With a customer base exceeding 1.18 crore and operations spread across 18,600+ postal codes in India, Hero FinCorp is positioning itself as a key player in India’s retail credit ecosystem. The upcoming IPO marks a significant milestone in the company’s growth journey and reflects strong investor interest in India’s fast-evolving NBFC sector.
