Hero Motors opens Rs 1,000 crore IPO with Rs 79-84 price band

The Development

Hero Motors Limited, a Punjab-headquartered powertrain systems provider, opened its initial public offering for public subscription on Wednesday, September 16, 2026, with the three-day bidding window scheduled to close on Friday, September 18, 2026, per the offer timetable in the company's red herring prospectus (RHP) filed with the Securities and Exchange Board of India (SEBI). Anchor investor bidding took place a day earlier, on Tuesday, September 15, 2026, as the abridged prospectus records.

The offer is a mainboard issue aggregating up to Rs 1,000 crore (Rs 10,000 million at a face value of Rs 10 per share), split between a fresh issue of up to Rs 600 crore and an offer for sale of up to Rs 400 crore. The price band has been fixed at Rs 79 to Rs 84 per equity share, per the issue's price-band announcement reported by The Economic Times, which surfaced the development. The RHP, dated September 9, 2026, records that the equity shares are proposed to be listed on the BSE and the National Stock Exchange (NSE), with the BSE designated as the stock exchange for the offer.

At this milestone the company has filed its offer document and set its terms. The RHP carries SEBI's standard caveat that the shares have "neither been recommended, nor approved" by the regulator, which does not guarantee the accuracy of the document's contents.

The Company

Per the RHP, Hero Motors describes itself as "a fully integrated powertrain systems provider" offering design, prototyping, validation, development and delivery of system-level and component-level powertrain solutions for both electric and non-electric powertrains. Its operations are organised into two segments: Powertrain Solutions, which the company discloses contributed 53.67% of revenue from operations in Fiscal 2026, and Alloys and Metallics, at 46.33%. Its offerings span two-wheelers, performance automotive, e-bikes, off-road vehicles, electric and hybrid cars, heavy-duty vehicles and electric vertical take-off and landing categories, and the company lists global customers including BMW AG and Ducati.

As of March 31, 2026, the company operated six manufacturing facilities across India, the United Kingdom and Thailand, including a joint venture with Yamaha Motors Japan in Ludhiana, per the offer document. On financials, the RHP discloses restated consolidated revenue from operations of Rs 1,188.35 crore in Fiscal 2026, up from Rs 1,089.59 crore in Fiscal 2025 and Rs 1,064.39 crore in Fiscal 2024. Profit for the year after tax was Rs 41.17 crore in Fiscal 2026, against Rs 32.80 crore in Fiscal 2025 and Rs 17.04 crore in Fiscal 2024. The promoters are Pankaj Munjal, Charu Munjal, Abhishek Munjal and O P Munjal Holdings, the company discloses.

The Offer Structure

The fresh issue component aggregates up to Rs 600 crore, while the offer for sale of up to Rs 400 crore comprises up to Rs 395 crore by promoter selling shareholder O P Munjal Holdings and up to Rs 5 crore by promoter group selling shareholder Hero Cycles Limited, per the RHP. In an offer for sale, proceeds go to the selling shareholders rather than the company; only the fresh-issue proceeds reach Hero Motors.

Per the offer document, the net proceeds of the fresh issue are proposed towards repayment or prepayment of certain borrowings (Rs 190 crore), capital expenditure for expansion of the company's Gautam Buddha Nagar facility in Uttar Pradesh (Rs 200 crore), and funding inorganic growth through unidentified acquisitions and general corporate purposes. The book-running lead managers are ICICI Securities, DAM Capital Advisors and JM Financial, with KFin Technologies as registrar to the offer. Readers working through the arithmetic of an allotment or a holding period can use Oquilia's lumpsum calculator or CAGR calculator; prior primary-market coverage sits on the Oquilia news desk.

Risk Factors

The RHP sets out a detailed risk-factors section, and the following are among the risks the company itself discloses. First, the company generates a portion of revenue from jurisdictions outside India, particularly Europe, which the RHP states contributed 33.59% of revenue from operations in Fiscal 2026; adverse events in those markets could affect revenue.

Second, the offer document lists customer concentration: revenue from the top 10 customers was Rs 866.14 crore in Fiscal 2026, or 72.89% of revenue from operations, and the loss of any of these customers could have a material adverse effect. Third, the company discloses dependence on the e-bike and two-wheeler industries in India and overseas, and, fourth, reliance on a limited set of suppliers for critical raw materials without definitive supply agreements for all of them. The RHP also records that operations involve hazardous materials, and notes a criminal complaint by the Uttar Pradesh Pollution Control Board alleging discharge of untreated effluent. These are the company's own disclosures, not an assessment by this desk.

What Happens Next

With anchor allocation completed on September 15 and the public issue open from September 16 to September 18, the standard mechanics run from here: once bidding closes, the basis of allotment is finalised by the registrar in consultation with the designated stock exchange, after which shares are credited to successful applicants' demat accounts and blocked funds are released for unsuccessful applications through the ASBA and UPI mechanism.

Listing on the BSE and NSE follows the finalisation of allotment, per the standard timetable, with the debut price determined on the listing day. The exact allotment and listing dates are set out in the offer document and exchange notices. This report is informational and is not investment advice or a recommendation to subscribe. The complete terms and the full risk-factors section are in the RHP on SEBI's website and the exchanges.

FAQ

Should I apply for this IPO?

Oquilia does not make recommendations. This report is informational and is not investment advice or a recommendation to subscribe. The RHP, including the complete risk-factors section, is available on SEBI's website and the exchanges - read it directly before making any decision.

What is the price band and issue size?

The price band has been fixed at Rs 79 to Rs 84 per equity share. The total offer aggregates up to Rs 1,000 crore, comprising a fresh issue of up to Rs 600 crore and an offer for sale of up to Rs 400 crore, per the red herring prospectus filed with SEBI.

When does the issue open and close?

Per the offer timetable in the RHP, anchor investor bidding took place on September 15, 2026, and the public subscription window is open from September 16 to September 18, 2026. The UPI mandate end time is 5:00 p.m. on the closing day.

Where can I read the RHP?

The red herring prospectus, dated September 9, 2026, is available on SEBI's website under Filings - Public Issues, and on the websites of the BSE and NSE, as well as the company and the book-running lead managers.

How is the basis of allotment decided?

After the issue closes, the registrar (KFin Technologies) finalises the basis of allotment in consultation with the designated stock exchange, the BSE. In an oversubscribed retail category, allotment is typically decided by a computerised lottery, with each successful applicant receiving at least one lot where possible.

This report is based on the red herring prospectus filed with SEBI and the abridged prospectus on the regulator's website. It was surfaced via coverage in The Economic Times.