Hero Motors has reduced the size of its proposed initial public offering (IPO) to Rs 1,000 crore, down from the Rs 1,200 crore issue it had originally planned. The revision follows approval from the Securities and Exchange Board of India (SEBI).
Under the revised structure, the IPO will comprise a fresh issue of Rs 600 crore and an offer-for-sale (OFS) of Rs 400 crore. The company had initially proposed to raise ₹800 crore through a fresh issue, alongside the same Rs 400-crore OFS.
Hero Motors had filed its Draft Red Herring Prospectus (DRHP) with SEBI in June 2025 for an IPO of up to Rs 1,200 crore.
The company approached SEBI on July 30 to reduce the fresh issue component. This was possible under rules that came into effect on April 13, 2026, allowing companies to revise their fresh issue size by up to 50% without filing a new DRHP. SEBI approved the change on August 27.
There have also been changes within the OFS structure. Bhagyoday Investments has withdrawn its offer of shares worth up to Rs 5 crore, while O P Munjal Holdings has increased its offer by the same amount to 395 crore. The remaining Rs 5 crore will be offered by Hero Cycles.
The company has also revised the proposed use of proceeds from the fresh issue.
Of the net proceeds, Rs 190 crore will be used for debt repayment, while Rs 200 crore will go towards purchasing equipment for capacity expansion at its facility in Gautam Buddha Nagar, Uttar Pradesh.
The remaining proceeds are earmarked for potential inorganic growth through unidentified acquisitions and general corporate purposes. Money raised through the OFS, meanwhile, will go to the selling shareholders rather than the company.
Hero Motors is a powertrain solutions provider serving both electric and conventional powertrain requirements. The company supplies automotive original equipment manufacturers across India, the US, Europe and the ASEAN region.
Its reported customers include BMW AG, Ducati Motor Holding, Enviolo International, Formula Motorsport, Hummingbird EV and HWA AG, along with electric bicycle manufacturers and customers across other mobility applications, including aerospace.
FAQs
- What is the revised size of Hero Motors’ IPO?
Hero Motors has reduced its proposed IPO size to ₹1,000 crore, from the earlier ₹1,200 crore. - How much of Hero Motors’ IPO will be a fresh issue?
The fresh issue has been reduced to ₹600 crore, from ₹800 crore earlier. - How much is the OFS component in Hero Motors’ IPO?
The offer-for-sale component remains at ₹400 crore. - Why has Hero Motors reduced its IPO size?
The company has revised the fresh issue component following changes to its IPO structure and after receiving SEBI approval for the modification. - How will Hero Motors use the IPO proceeds?
The proceeds from the fresh issue are planned to be used towards debt repayment, capacity expansion, potential acquisitions and general corporate purposes.
