Hero Motors Ltd, the automotive components subsidiary of the Hero Motors Company (HMC) Group, has officially retracted its documents for an initial public offering (IPO) amounting to ₹900 crore, as reported in an update from the markets regulator, Sebi, on Monday. In its draft documents, the firm had intended to raise ₹500 crore through a new issuance of equity shares, alongside an offer for sale (OFS) of shares valued at ₹400 crore by its promoters.
The OFS was set to include a share divestment by O P Munjal Holdings, which planned to offload shares worth ₹250 crore. Additionally, both Bhagyoday Investments and Hero Cycles were scheduled to sell shares valued at ₹75 crore each. The company initially submitted its draft red herring prospectus (DRHP) in August, seeking approval from Sebi to proceed with the IPO.
However, without providing specific reasons, Hero Motors announced that its “DRHP was withdrawn on October 5, 2024.” According to the initial draft documents, the funds raised from the new equity issuance were intended for several purposes, including the repayment of debts and the acquisition of equipment essential for expanding the capacity at the company’s facility located in Gautam Buddha Nagar, Uttar Pradesh.
Hero Motors is recognized as a leading automotive technology entity in India, specializing in the design, development, manufacturing, and supply of highly engineered powertrain solutions tailored for automotive original equipment manufacturers (OEMs) in various global markets, including the United States, Europe, India, and the ASEAN region. The company has built a reputation for innovation in the automotive sector, with a diverse product range that includes both electric and non-electric powertrains designed for multiple vehicle categories.
These categories encompass two-wheelers, e-bikes, off-road vehicles, as well as electric and hybrid cars, and heavy-duty vehicles. This extensive portfolio positions Hero Motors at the forefront of the evolving automotive landscape, which increasingly demands more efficient and sustainable powertrain solutions.
Hero Motors operates through two primary business segments: powertrain solutions and alloys and metallics. The company has established six manufacturing facilities across key locations, including India, the United Kingdom, and Thailand, ensuring it can meet the demands of both domestic and international markets effectively.
The retraction of the IPO documents comes at a pivotal time for the company as it continues to navigate the complexities of the automotive industry, which is undergoing significant transformation due to advancements in technology and shifts in consumer preferences.
Despite this setback in its public offering plans, Hero Motors remains committed to its mission of delivering high-quality automotive components and solutions that enhance the performance and sustainability of vehicles across various segments. The company’s focus on innovation and expansion will likely play a critical role in shaping its future trajectory within the automotive sector.
Hero Motors Ltd, part of the Hero Motors Company (HMC) Group, is a prominent Indian automotive technology firm specializing in designing, manufacturing, and supplying advanced powertrain solutions. With a diverse product range that includes electric and non-electric powertrains for two-wheelers, e-bikes, and heavy-duty vehicles, Hero Motors operates globally, catering to OEMs in the United States, Europe, and Asia.
