Hero Motors' Rs 1,000 crore IPO opened for subscription on September 16, 2026, and has already garnered significant attention with a 17% overall subscription on the first day. The IPO, which will remain open until September 18, 2026, is drawing interest due to its Grey Market Premium (GMP) of Rs 19, indicating a 23% premium over the upper price band of Rs 84.
The IPO comprises a fresh issue of 7.14 crore shares worth Rs 600 crore and an offer for sale of 4.76 crore shares worth Rs 400 crore. It features a price band of Rs 79 to Rs 84 per share, with a minimum lot size of 178 shares. At the upper price band, retail investors need to invest at least Rs 14,952 for one lot. ICICI Securities Ltd. is the book-running lead manager, while Kfin Technologies Ltd. is the registrar.
On the first day of bidding, the retail portion was subscribed 26%, while the Non-Institutional Investors (NIIs) category saw a 19% subscription. However, the Qualified Institutional Buyers (QIBs) portion did not receive any bids against the 2.53 crore shares on offer. Hero Motors raised Rs 299.99 crore from anchor investors by allotting 3,57,14,284 equity shares at Rs 84 per share, with participation from institutions like ICICI Prudential Life Insurance and Edelweiss Life Insurance.
The IPO aims to use the proceeds for repaying certain borrowings, capital expenditure, and supporting inorganic growth plans. Hero Motors reported a 9% increase in total income to Rs 1,216.74 crore in FY26, with a 26% rise in profit after tax to Rs 41.17 crore, reflecting improved profitability.
Incorporated in 1998, Hero Motors is a key player in automotive technology, specializing in powertrain solutions for various vehicle types. The company has established relationships with major clients like BMW and Ducati, supported by in-house engineering and global partnerships.
Background
Hero Motors' IPO comes at a time when the automotive industry is witnessing a shift towards electrification and advanced powertrain technologies. The company's strong presence in e-bike powertrains and its partnerships with global automotive giants position it well to capitalize on these trends.
Looking ahead, market participants are keenly observing the IPO's performance, especially given the strong GMP. Investors are advised to consider the IPO as a potential long-term investment opportunity, with the listing expected on September 23, 2026.
