Hero Motors Limited has raised nearly Rs 300 crore from anchor investors ahead of the opening of its initial public offering (IPO), attracting significant participation from domestic mutual funds and institutional investors.
The Noida-based automotive technology company allotted 3,57,14,284 equity shares at Rs 84 each, the upper end of its IPO price band. The anchor allocation amounted to Rs 299.99 crore.
The company’s IPO opens for public subscription on September 16, 2026, and will remain open until September 18.
Domestic Mutual Funds Get 82% of Anchor Allocation
Domestic mutual funds accounted for the bulk of Hero Motors’ anchor book.
The company allocated 2,91,64,441 shares, or approximately 82% of the total anchor allocation, to seven domestic mutual funds through 16 schemes.
The anchor investor list included institutions such as ICICI Prudential Life Insurance Company, 3P India Equity Fund 1M, Edelweiss Life Insurance Company, Societe Generale-ODI and ASAS Global Fund Incorporated VCC Sub Fund.
Among the equity-oriented mutual fund schemes participating in the allocation were ICICI Prudential Smallcap Fund, Kotak Mahindra Trustee Co Ltd A/C Kotak MNC Fund and JM Financial Mutual Fund-JM Flexi Cap Fund.
Hero Motors IPO Price Band and Subscription Dates
Hero Motors has set an IPO price band of Rs 79 to Rs 84 per equity share, with each share having a face value of Rs 10.
The public issue is scheduled to open on September 16 and close on September 18, 2026.
Investors can bid for a minimum of 178 shares, with subsequent bids required to be placed in multiples of 178 shares.
At the upper end of the price band, Hero Motors’ implied valuation is approximately Rs 3,815 crore.
Rs 1,000 Crore IPO Includes Fresh Issue and OFS
Hero Motors’ maiden public offering is worth Rs 1,000 crore.
The issue comprises:
- Fresh issue: Up to Rs 600 crore
- Offer for sale (OFS): Up to Rs 400 crore
The OFS component will involve promoter shareholders O P Munjal Holdings and Hero Cycles.
The fresh issue proceeds will be used for several corporate purposes. Around Rs 190 crore has been earmarked for repayment or prepayment of outstanding borrowings.
Another Rs 200 crore will be used toward capital expenditure for capacity expansion at the company’s facility in Gautam Buddha Nagar, Uttar Pradesh, along with potential inorganic growth through acquisitions and other strategic and general corporate requirements.
IPO Quota for Different Investor Categories
Under the book-building structure, not more than 50% of the net issue has been reserved for qualified institutional buyers.
The allocation for non-institutional investors will be not less than 15%, while not less than 35% of the net offer will be reserved for retail individual investors.
The IPO’s book-running lead managers are ICICI Securities, DAM Capital Advisors and JM Financial. KFin Technologies is acting as the registrar to the issue.
Following the IPO, Hero Motors has proposed to list its shares on both the NSE and BSE.
Hero Motors IPO Size Has Changed Over Time
The Rs 1,000 crore IPO represents a reduction from the issue size proposed in Hero Motors’ previous draft filing.
The company initially submitted draft papers to the Securities and Exchange Board of India (SEBI) in August 2024 for a Rs 900 crore IPO. That proposal consisted of a Rs 500 crore fresh issue and a Rs 400 crore OFS. Hero Motors subsequently withdrew the draft papers in October 2024.
The company returned to the IPO process in July 2025 with a larger proposed issue of Rs 1,200 crore, comprising an Rs 800 crore fresh issue and a Rs 400 crore OFS.
The IPO opening in September 2026 has retained the Rs 400 crore OFS component but reduced the fresh issue to Rs 600 crore, bringing the overall issue size to Rs 1,000 crore.
What Does Hero Motors Do?
Hero Motors Limited is an automotive technology company specialising in powertrain systems. The company designs, develops, manufactures and supplies powertrain solutions to original equipment manufacturers (OEMs) across markets including India, Europe, the United States and the ASEAN region.
According to a CRISIL report cited by the company, Hero Motors operates as an integrated powertrain systems provider, with capabilities spanning design, prototyping, validation and development for electric as well as non-electric powertrain applications.
Its products are used across multiple vehicle and mobility segments, including two-wheelers, performance automobiles, e-bikes, off-road vehicles, electric and hybrid cars and heavy-duty vehicles.
The company also has exposure to emerging mobility applications, including electric vertical take-off and landing (eVTOL) vehicles.
Hero Motors’ Customer Base
Hero Motors counts several international companies among its customers.
The customer base cited by the company includes BMW, Ducati Motor Holding, Enviolo International, Formula Motorsport, Hummingbird EV and HWA AG, along with global e-bike manufacturers and customers operating in aerospace mobility applications.
