Hero FinCorp IPO
IPO Price Range: Not Announced Yet
IPO Status
Upcoming
Listing Exchange
BSE
Objectives of IPO
- Business Growth: Hero FinCorp plans to use the proceeds for bettering its financial base (Tier-1 Capital) by business expansion and offering more loans.
- Listing of Equity Shares: Hero FinCorp aims to list the shares on the stock exchange to strengthen its brand image and allow liquidity and attract investor participation.
- Stake Divestment: Hero FinCorp, the promoter of HDB Financial Services, is cashing via the IPO by selling its stake in the offer for the sale of shares.
Financial Performance of Hero FinCorp
Strengths and Risks
Strengths
Diversified Offerings: Hero FinCorp targets retail and MSME customers in India offering two-wheeler loans to a range of secured/unsecured loans. In FY24, more than 80% of the total AUM (₹51,820.8 crore), contributed by retail and MSME loans.
Brand Equity: Hero FinCorp benefits from the Hero brand, rated AAA by Brand Finance. Hero FinCorp plays a vital role in enabling retail growth of Hero MotoCorp (India’s largest two-wheeler manufacturer) by financing a significant part of sales of two-wheelers.
Customer Base: Hero FinCorp has a strong customer base of 11.8 million as of March 2024 which includes 5 million retail borrowers, 29k MSMEs, and 360 CIFs.
Large Network: Hero FinCorp’s presence (physical and digital) spans over 95% of India’s pincodes. It has more than 7,500 sales staff, 140 branches, and 4,257 Hero MotoCorp dealer touchpoints.
Risks
Dependence on Hero MotoCorp Dealerships: Hero FinCorp’s 99% of two-wheeler loans are via Hero MotoCorp’s dealership. A decline in demand of two Hero two wheelers and any conflicts between the two entities can result in a huge customer loss for the company.
Credit Risk: The company’s non-performing assets (NPAs) were at 4.02% of the total gross loans in FY24. Any rise in these, defaults, or delayed payments can hurt the company’s profitability.
New-to-Credit (NTC) Borrowers: In FY24, Hero FinCorp had around 27% NTC borrowers of the retail AUM. NTCs are usually lack credit history which increases the default risk.
Regulatory Proceedings: In August 2023, ED seized assets worth ₹25 crore involving Pawan Kant Munjal, chairman and managing director of Hero Motocorp for money-laundering.
How to Apply for Hero FinCorp IPO on INDmoney
- Download the INDmoney app and complete your KYC.
- Go to INDstocks → IPO, or just search “IPO”.
- Tap on Hero FinCorp IPO from the list of live IPOs.
- View key details like price band, lot size, and dates.
- Tap Apply Now and choose your number of lots.
- Use INDpay UPI for instant mandate tracking.
- Your funds will be blocked until the share allotment is finalized.
Listed Competitors of Hero FinCorp
Bajaj Finance
Bajaj Finance offers diverse loans (personal, home, business), EMI financing, insurance, and investments, targeting retail and SMEs with digital solutions.
Shriram Finance
Shriram Finance provides vehicle, business, and personal loans, fixed deposits, and insurance, focusing on rural and underserved markets.
Cholamandalam Investment and Finance Company
Cholamandalam Investment and Finance Company specializes in vehicle, home, and SME loans, leveraging extensive branches for asset-backed financing.
Unlisted Competitors of Hero FinCorp
HDB Financial Services
HDB Financial Services is a leading NBFC offering secured and unsecured loans, investments, and protection solutions, with 1,747+ branches. It also provides BPO services, including back-office support and customer management.
ICL Fincorp
ICL Fincorp is an NBFC offering gold, vehicle, and asset loans, along with investment and insurance services. It also operates in travel, education, and brokerage, with a presence across India and UAE.
Tata Capital
Tata Capital offers financial products and services such as personal loans, home loans, business loans, and services like wealth management, private equity, SME financing, leasing, and credit cards.
Hero FinCorp Shareholding Pattern
| Promoters | 72.98% | |
| Name | Role | Stakeholding |
| Hero MotoCorp Limited | Promoter | 39.56% |
| Bahadur Chand Investments | Promoter | 15.72% |
| BMOP | Promoter | 8.24% |
| Hero InvestCorp | Promoter | 2.08% |
| Public | 27.02% | |
| Name | Role | Stakeholding |
| Otter Limited | Investor | 7.82% |
| Others | Public | 26.58% |
About Hero FinCorp
The company’s retail loans include vehicle, personal and mortgage loans with an assets under management (AUM) of ₹51,820.8 crore as of March 2024. Hero FinCorp’s retail and MSME loan verticals contributes over 80% of the total AUM.
Hero FinCorp IPO offer size is ₹3,668 crore with a fresh issue of ₹2,100 crore and an offer for sale (OFS) of ₹1,568 crore. Hero FinCorp IPO date is yet to be declared.
Hero FinCorp DRHP (Draft Red Herring Prospectus) was filed with SEBI in July 2024.
Products & Services
| Product | Non-Banking Financial Company |
| Known For | Loans and financial services |
| Top Products | Retail Loans, MSME Loans, CIF Loans |