Hero FinCorp okays ₹4,000 crore IPO

Hero FinCorp, the financial services subsidiary of India's largest two-wheeler maker Hero MotoCorp, has approved the ₹4,000 crore initial public offering (IPO).

The IPO will be a combination of fresh issue of shares and an offer for sale by existing shareholders.

Hero FinCorp offers two-wheeler loan, car loan, home loan, and business loans among others. The lender is present at close to 2000 retail financing touch-points across Hero MotoCorp's network, and has partnered with over 2000 corporate clients.

Hero MotoCorp holds around 40% stake in Hero Fincorp. The Munjal family hold around 35-39% stake while the balance is held by private equity investors.

Hero MotoCorp reported a consolidated net profit of ₹943 crore for the quarter ended March, reflecting a growth of 16% over the same period last year. Consolidated revenue for the quarter stood at ₹9,617 crore, clocking a growth of 14% over the previous year.

The company declared a final dividend of ₹40 per share. This dividend together with interim and special dividend of ₹100 per equity share, takes the aggregate total dividend for the year 2023- 24 to ₹140 per equity share.

EBIDTA (earnings before interest, taxes, depreciation, and amortisation) margin for the quarter was at 14.3%, reflecting an improvement of 120 basis points on a year-on-year basis, driven by product mix, lower commodity costs, higher savings, and price increases.

During the year, Hero MotoCorp expanded its premium motorcycle portfolio by launching six new products – Xtreme 125R, Xtreme 200S, Xtreme 160R 4V, Harley-Davidson X440, Karizma XMR and the Mavrick 440.

Hero MotoCorp said it will take big strides in electric vehicles (EVs) through product launches in the mid and affordable segments in the coming year. “Moving forward, we expect the macro‐economic factors to aid the industry’s growth. With commodity prices remaining stable, expectations of normal monsoons, and government spending expected to increase, we see multiple tailwinds for the sector over the upcoming quarters. We will be driving market share gains on the back of our launches in premium and 125 cc segment done in FY 24. Further, we are going to boost scooter portfolio by launching Xoom 125 cc and Xoom 160 cc in first half of the fiscal,” said Niranjan Gupta, CEO of Hero MotoCorp.