Hero Motors IPO: The renowned auto-components company, Hero Motors which belongs to the Hero Motors Company Group (HMC) has taken a significant step towards going public. Backed by South Asia Growth Invest, it has submitted a draft red herring prospectus (DRHP) to the Securities and Exchange Board of India (SEBI). As per filing on August 23, it concerns raising Rupees 900 crores through an IPO.
As per the DRHP which was filed on August 23, the upcoming IPO will have a fresh equity issuance of Rupees 500 crores along with an offer-for-sale (OFS) of Rupees 400 crores worth of shares by the promoters of the company. It has been reported that promoter OP Munjal Holdings plans to sell shares worth Rupees 250 crores through the OFS. Bhagyoday Investments and Hero Cycles on the other hand will offload Rupees 75 crores worth of shares each.
There is also a possibility that Hero Motors may explore a pre-IPO placement of Rupees 100 crores before filing the Red Herring Prospectus with the Registrar of Companies (ROC). As per the report, if this placement occurs, then its proceeds would mitigate the amount allocated for general corporate purposes from the fresh issue.
Currently, OP Munjal has a 71.55% stake in Hero Motors on a fully diluted basis. Bhagyoday Investments and Hero Cycles on the other hand have a stake of 6.28% and 2.03% respectively. South Asia Growth Invest LLC has a 12.27% shareholding in the company.
Being a leader in providing powertrain solutions (both electric and non-electric powertrains) to automotive original equipment manufacturers (OEMs) across the US, Europe, India and the ASEAN region, Hero Motors caters to a wide clientele in the automotive industry. Some of them include off-road vehicles, two-wheelers, e-bikes, heavy-duty vehicles, electric and hybrid cars, and electric vertical take-off and landing (eVTOL) aircraft.