Hero Motors Limited, an automotive powertrain and transmission company promoted by the Munjal family, is launching a ₹1,000 crore mainboard IPO at a price band of ₹79 to ₹84 per share. The issue opens on 16 September 2026, closes on 18 September 2026, and is expected to list on the BSE and NSE on 23 September 2026. Here is a closer look at the issue structure, the business, the financial track record and the disclosed risks, so you can read the offer before you apply.
Hero Motors IPO: Key Details
| Parameter | Details |
|---|---|
| IPO Dates | 16 September 2026 to 18 September 2026 |
| Anchor Book | 15 September 2026 |
| Face Value | ₹10 per share |
| Price Band | ₹79 to ₹84 per share |
| Lot Size | 178 shares (minimum ₹14,952 at the cap price) |
| Issue Type | Book-built, fresh issue plus offer for sale |
| Total Issue Size | ₹1,000 crore |
| Fresh Issue | ₹600 crore |
| Offer for Sale | ₹400 crore |
| Listing Exchanges | BSE and NSE (BSE is the Designated Stock Exchange) |
| Allotment Date | 21 September 2026 |
| Credit to Demat | 22 September 2026 |
| Listing Date | 23 September 2026 (tentative) |
| Registrar | KFin Technologies Limited |
| Book Running Lead Managers | ICICI Securities, DAM Capital Advisors, JM Financial |
Issue details are as per the Red Herring Prospectus dated 9 September 2026 and the price band announcement of 10 September 2026. Schedules for IPOs are tentative and can shift, so confirm the final terms in the RHP before you apply.
Who gets how much
The offer is made under Regulation 6(1) of the SEBI ICDR Regulations, so the reservation split is:
| Investor Category | Reservation |
|---|---|
| Qualified Institutional Buyers (QIB) | Not more than 50% of the net offer |
| Non-Institutional Investors (NII) | Not less than 15% |
| Retail Individual Investors (RII) | Not less than 35% |
What a retail application actually costs
One lot is 178 shares. At the floor price of ₹79 that is ₹14,062, and at the cap price of ₹84 it is ₹14,952. Applications are blocked at the cap price, so plan for ₹14,952 per lot.
SEBI caps a retail individual investor’s application at ₹2 lakh. At ₹84 per share that works out to a maximum of 13 lots, or ₹1,94,376. A 14th lot would take the application to ₹2,09,328 and push you into the small non-institutional (sHNI) category instead.
About Hero Motors Limited
Hero Motors was incorporated in April 1998 and has its registered office in Ludhiana, Punjab, with a corporate office in Noida, Uttar Pradesh. The company designs, develops, manufactures and supplies engineered powertrain solutions to automotive original equipment manufacturers (OEMs) in India, Europe, the United States and the ASEAN region.
The business runs across two reporting segments:
- Powertrain Solutions, covering gears and transmission (G&T) and bike powertrain (BPT) for e-bikes and micro-mobility. This contributed 53.67% of FY 2025-26 revenue.
- Alloys and Metallics (A&M), covering sheet metal and tubular assemblies and components for automotive OEMs. This contributed 46.33%.
Other points from the RHP worth knowing:
- Customers include BMW, Ducati, Hero MotoCorp, enviolo, Formula Motorsport, HWA and Hummingbird EV.
- As of 31 March 2026, it operated six manufacturing facilities across India, the United Kingdom and Thailand. The Indian plants are at Ludhiana, Punjab and Gautam Buddha Nagar, Uttar Pradesh.
- Revenue from electric mobility applications rose to 23.00% of revenue in FY 2025-26, from 12.03% in FY 2023-24.
- Research and development spending was 7.54% of revenue in FY 2025-26, which is well above the peer set disclosed in the RHP.
- International customers accounted for 41.36% of FY 2025-26 revenue, with Europe alone at 33.59%.
Financial Performance (FY 2023-24 to FY 2025-26)
All figures below are from the Restated Consolidated Financial Information in the RHP, converted from ₹ million to ₹ crore.
| Metric | FY 2025-26 | FY 2024-25 | FY 2023-24 |
|---|---|---|---|
| Revenue from Operations | ₹1,188.35 crore | ₹1,089.59 crore | ₹1,064.39 crore |
| Revenue Growth | 9.06% | 2.37% | 0.93% |
| Gross Profit | ₹495.46 crore | ₹452.16 crore | ₹419.37 crore |
| Gross Margin | 41.69% | 41.50% | 39.40% |
| EBITDA | ₹147.78 crore | ₹114.00 crore | ₹86.28 crore |
| EBITDA Margin | 12.44% | 10.46% | 8.11% |
| Profit After Tax (PAT) | ₹41.17 crore | ₹32.80 crore | ₹17.04 crore |
| PAT Margin | 3.46% | 3.01% | 1.60% |
| Total Equity (Net Worth) | ₹481.01 crore | ₹426.01 crore | ₹374.82 crore |
| Return on Equity | 8.56% | 7.70% | 4.54% |
| Return on Capital Employed | 19.77% | 18.84% | 23.23% |
| Net Debt to Adjusted EBITDA | 2.24 times | 2.79 times | 1.72 times |
The pattern here is modest topline growth with sharp margin repair. Revenue grew at a two-year CAGR of about 5.7% from FY 2023-24 to FY 2025-26, while PAT grew at roughly 55% CAGR off a small base. EBITDA margin expanded by more than four percentage points over the same period.
Two things to watch on the working capital side: receivable days stretched from 67 in FY 2023-24 to 78 in FY 2025-26, and inventory days sat at 64. Longer collection cycles mean accounting profit and cash generation can move apart, so track cash flow from operations in the first few quarterly results after listing.
These are historical disclosures. They do not indicate future performance.
Valuation Metrics Explained
Valuation ratios tell you what you are paying for each rupee of earnings and book value.
| Ratio | Value |
|---|---|
| Basic EPS (FY 2025-26) | ₹1.15 |
| Diluted EPS (FY 2025-26) | ₹1.14 |
| Weighted Average Diluted EPS (3 years) | ₹0.85 |
| Return on Net Worth (FY 2025-26) | 8.53% |
| Weighted Average RoNW (3 years) | 7.58% |
| Net Asset Value per share (31 March 2026) | ₹12.72 |
| Market Cap at cap price | About ₹3,815 crore |
Key formulas
- EPS (Earnings Per Share) = Net profit after tax ÷ Weighted average number of shares
- P/E Ratio = Share price ÷ EPS
- RoNW = Net profit after tax ÷ Net worth × 100
- NAV per share = Net assets ÷ Number of shares outstanding
Working out the P/E
The RHP leaves the P/E blank because the price band was fixed after it was filed. Using the disclosed FY 2025-26 diluted EPS of ₹1.14:
- P/E at the floor price of ₹79 works out to about 69.3 times
- P/E at the cap price of ₹84 works out to about 73.7 times
On a post-issue diluted basis the multiple is higher still, because the fresh issue adds roughly 7.14 crore new shares. Post-issue EPS on FY 2025-26 earnings comes to about ₹0.91, putting the P/E at the cap price near 92 times.
Price to book at the cap price is about 6.6 times the 31 March 2026 NAV of ₹12.72.
How that compares with listed peers
The RHP discloses this peer set, using closing prices on the BSE as on 7 September 2026 and FY 2025-26 diluted EPS.
| Company | FY 2025-26 Revenue | Diluted EPS | NAV per share | P/E | RoNW |
|---|---|---|---|---|---|
| Hero Motors Limited | ₹1,188.35 crore | ₹1.14 | ₹12.72 | Not applicable | 8.53% |
| Sona BLW Precision Forgings | ₹4,449.46 crore | ₹10.30 | ₹93.93 | 76.50 | 10.77% |
| UNO Minda | ₹19,657.59 crore | ₹20.75 | ₹113.77 | 59.84 | 19.59% |
| Varroc Engineering | ₹8,890.49 crore | ₹14.73 | ₹80.45 | 56.15 | 18.70% |
| Endurance Technologies | ₹14,595.88 crore | ₹67.66 | ₹442.54 | 40.84 | 15.29% |
| CIE Automotive India | ₹9,406.47 crore | ₹21.69 | ₹164.65 | 17.68 | 13.18% |
The RHP puts the peer group average P/E at 50.20 times, with a high of 76.50 and a low of 17.68.
Read this table honestly. Hero Motors is asking for a multiple at the top end of its peer range while posting the lowest RoNW, the lowest PAT margin and the smallest revenue base in the set. The counter-argument is the EV revenue mix and the R&D intensity, which are both well ahead of peers. Whether that justifies the premium is a judgement call, and it is yours to make.
These ratios are shared for educational understanding, not as investment guidance.
Objects of the Issue
The company receives nothing from the ₹400 crore offer for sale. Only the ₹600 crore fresh issue proceeds come to Hero Motors, and the RHP earmarks them as follows:
| Object | Amount |
|---|---|
| Repayment or prepayment of certain outstanding borrowings | ₹190 crore |
| Capital expenditure for capacity expansion at the Gautam Buddha Nagar, Uttar Pradesh facility | ₹200 crore |
| Inorganic growth through unidentified acquisitions and general corporate purposes | Balance of net proceeds |
On the debt repayment, the RHP discloses standalone outstanding borrowings of ₹289.55 crore as on 31 July 2026 across facilities from Axis Bank, Kotak Mahindra Bank and ICICI Bank, with effective interest rates between 6.65% and 8.10%. The ₹190 crore repayment covers 44.49% of that.
On the acquisitions line, note the SEBI ICDR caps the company has disclosed: inorganic growth and general corporate purposes together cannot exceed 35% of gross fresh issue proceeds, general corporate purposes alone cannot exceed 25%, and unidentified acquisitions alone cannot exceed 25%. Money set aside for acquisitions that have not been identified yet is, by definition, the least visible use of your capital in this issue.
The capex at Gautam Buddha Nagar is scheduled across three financial years: ₹66 crore in FY 2026-27, ₹60 crore in FY 2027-28 and ₹74 crore in FY 2028-29.
The company’s bank facilities carry a CRISIL A+/Stable long-term rating and CRISIL A1 short-term rating, reaffirmed on 24 August 2026.
Strengths and Risk Factors
A fair reading of any IPO means putting the pitch and the disclosed risks side by side.
| Strengths | Risk Factors |
|---|---|
| Fully integrated powertrain player serving global OEMs including BMW, Ducati and Hero MotoCorp | Top 10 customers made up 72.89% of FY 2025-26 revenue, so losing one account matters |
| EV-linked revenue almost doubled in share, from 12.03% in FY 2023-24 to 23.00% in FY 2025-26 | 41.36% of revenue comes from international customers, with Europe alone at 33.59%, exposing the business to a slowdown or regulatory change in one region |
| R&D spend at 7.54% of revenue, materially higher than every listed peer disclosed in the RHP | Raw materials were 54.99% of revenue in FY 2025-26, so input cost swings hit margins directly |
| EBITDA margin expanded from 8.11% to 12.44% over three years | Demand is tied to the e-bike and two-wheeler cycle in India and overseas, which is cyclical |
| Six manufacturing sites across India, the UK and Thailand, close to customer bases | Receivable days rose from 67 to 78, and net debt to adjusted EBITDA stood at 2.24 times |
| CRISIL A+/Stable bank facility rating, reaffirmed in August 2026 | No definitive long-term supply agreements with all suppliers; most raw material is bought on purchase orders |
| Promoter group holding of about 73.97% before the issue | One customer undertook a product recall in FY 2025-26, claiming a faulty product supplied by the company |
Go through the full risk factors section of the Red Herring Prospectus, which begins on page 21, before making any decision. The list above is a summary, not a substitute.
How to Apply for the Hero Motors IPO via Findoc
- Log in to your Findoc trading and demat account.
- Go to the IPO section on the Findoc platform or app.
- Select “Hero Motors IPO” from the list of active issues.
- Enter your UPI ID, the quantity in multiples of 178 shares, and a bid price within the ₹79 to ₹84 band.
- Approve the UPI mandate request in your linked banking app to block the funds.
Bank ASBA through net banking is the other route, where your bank blocks the amount in your account instead of a UPI mandate.
If you do not have an account yet, you can complete your demat account signup before the issue closes on 18 September 2026.
Checking your allotment
Basis of allotment is expected on 21 September 2026. You can check your status in three places using your PAN, application number or DP/Client ID:
- KFin Technologies, the registrar for this issue
- The BSE website
- The NSE website
Refunds and unblocking of funds for unsuccessful applications happen around 22 September 2026, with shares credited to successful applicants the same day.
Key Takeaways
- Hero Motors IPO is a ₹1,000 crore book-built issue, made up of a ₹600 crore fresh issue and a ₹400 crore offer for sale.
- The price band is ₹79 to ₹84 per share, with a lot of 178 shares and a minimum retail application of ₹14,952.
- Bidding runs from 16 to 18 September 2026, with listing on the BSE and NSE expected on 23 September 2026.
- FY 2025-26 revenue was ₹1,188.35 crore with PAT of ₹41.17 crore, and EBITDA margin improved to 12.44% from 8.11% two years earlier.
- At the cap price, the P/E works out to roughly 73.7 times on FY 2025-26 diluted EPS, against a disclosed peer average of 50.20 times.
- Customer concentration, export dependence on Europe and rising receivable days are the main disclosed risks.
Reads more:
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- NSE IPO 2026
- Pranav Constructions Debuts at 33% Premium on NSE
- How IPO Work?
- IPO Eligibility Criteria
- What is Grey Market in IPO and How it Works?
- What is DRHP?
Disclaimer: This article is for educational and informational purposes only and is not investment advice, nor a recommendation to buy, sell or subscribe to any security. Investments in securities markets are subject to market risks. Read all the related documents carefully before investing, including the Red Herring Prospectus. Past performance is not indicative of future results. IPO schedules, price bands and issue terms are subject to change. All figures in this article are taken from the Hero Motors Limited Red Herring Prospectus dated 9 September 2026 and are current as of 15 September 2026. Please consult a SEBI-registered investment adviser before making any investment decision.
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