Hero Motors Gets SEBI Approval For ₹1,200 Crore IPO, Fresh Issue & OFS To Fund Growth Plans

Mumbai: Hero Motors, a well-known auto parts manufacturer, has received the go-ahead from the Securities and Exchange Board of India (SEBI) to launch its initial public offering (IPO). This approval was confirmed in a SEBI filing on Monday, September 15.

IPO Structure and Fund Allocation

The IPO is worth Rs 1,200 crore, and it includes two parts: a fresh issue of Rs 800 crore and an offer for sale (OFS) worth Rs 400 crore.

The fresh issue funds will be used for several key purposes:

- Rs 285 crore will go toward repaying debt.

- Rs 237 crore will be invested in new machinery at the company’s Gautam Buddha Nagar plant.

Some funds will be reserved for future acquisitions and to meet general corporate expenses.

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As for the OFS portion, OP Munjal Holdings will sell shares worth Rs 390 crore, while Bhagyoday Investments and Hero Cycles will offload shares worth Rs 5 crore each.

Who Can Invest in the IPO?

The IPO will be offered at a face value of Rs 10 per share. The allocation will be as follows:

- 50 percent for Qualified Institutional Buyers (QIBs)

- 15 percent for Non-Institutional Investors (NIIs)

- 35 percent for Retail Investors

Hero Motors may also raise Rs 160 crore through a pre-IPO placement, which would reduce the fresh issue size accordingly.

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Company Background and Key Clients

Hero Motors is led by Pankaj Munjal, who is the cousin of Hero MotoCorp Chairman Pawan Munjal. The company manufactures engine and transmission parts for two-wheelers and supplies major global brands like BMW, Ducati, and Harley-Davidson.

Initially, the company had filed for a Rs 900 crore IPO in August 2024 but later increased the size to Rs 1,200 crore in its revised filing submitted in July 2025.

With this IPO, Hero Motors aims to strengthen its financial position and expand its manufacturing capabilities.