The Hero FinCorp IPO is one of the most anticipated public offerings in India’s financial services space. Hero FinCorp Limited, the lending arm of the Hero Group, has received approval to raise around ₹3,668 crore through a public issue, comprising a mix of fresh issue and offer for sale (OFS).
This IPO gives investors a chance to participate in the growth of a large, diversified NBFC (Non-Banking Financial Company) backed by one of India’s most trusted corporate groups.
This blog explains everything investors should know before tracking or applying for the Hero FinCorp IPO.
Hero FinCorp IPO: Key Details (At a Glance)
| Particulars | Details |
|---|---|
| Company Name | Hero FinCorp Limited |
| IPO Size | ~₹3,668 crore |
| Fresh Issue | ~₹2,100 crore |
| Offer for Sale (OFS) | ~₹1,568 crore |
| IPO Type | Book-built issue |
| Price Band | To be announced |
| Lot Size | To be announced |
| Listing Exchange | NSE & BSE |
| IPO Status | SEBI approval received |
| Sector | NBFC / Financial Services |
About Hero FinCorp: Business Overview
Hero FinCorp Limited is a diversified non-banking financial company (NBFC) promoted by the Hero Group, best known for Hero MotoCorp.
Initially focused on two-wheeler financing, the company has expanded into multiple lending segments, including:
- Two-wheeler loans
- Used car loans
- Personal loans
- MSME and business loans
- Mortgage and secured loans
- Corporate lending
Hero FinCorp operates through a mix of physical branch presence and digital lending platforms, serving both urban and semi-urban customers across India.
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Why Hero FinCorp IPO Is Important
The Hero FinCorp IPO is significant because:
- It is one of the largest NBFC IPOs in recent times
- It strengthens the Hero Group’s presence in the listed financial services space
- IPO proceeds will boost Tier-1 capital, enabling higher loan growth
- It offers liquidity to existing investors via OFS
India’s credit demand is expanding rapidly, especially in retail and MSME lending—segments where Hero FinCorp has strong exposure.
Hero FinCorp Financial Performance
Based on available pre-IPO disclosures:
| Financial Year | Revenue (₹ Cr) | Profit After Tax (₹ Cr) |
|---|---|---|
| FY22 | ~4,738 | (191) Loss |
| FY23 | ~6,402 | ~480 |
| FY24 | ~8,359 | ~637 |
Key Financial Observations
- Strong revenue growth over the last three years
- Clear turnaround from losses to profitability
- Expanding loan book supported by capital infusion
- Improved operating leverage with scale
Investors should still review the final DRHP/RHP for detailed asset quality, GNPA/NNPA ratios, and cash flow data.
Use of IPO Proceeds
The company plans to utilise IPO proceeds mainly for:
- Augmenting Tier-1 capital to support future lending
- Expanding the loan book across the retail and MSME segments
- Investing in technology and digital lending infrastructure
- General corporate purposes
A stronger capital base helps NBFCs grow without breaching regulatory capital adequacy norms.
Valuation Perspective (What Investors Should Watch)
Although the price band is yet to be announced, investors should carefully evaluate:
- P/E and P/B ratios vs listed NBFC peers
- Return on equity (ROE)
- Asset quality trends (GNPA, NNPA)
- Net interest margins (NIMs)
- Cost of funds vs peers
Valuation discipline will play a major role in determining post-listing performance.
Hero FinCorp IPO: Pros & Cons
Pros (Strengths)
- Backed by the Hero Group, a trusted Indian brand
- Diversified loan portfolio reduces dependency on a single segment
- Strong revenue and profit growth in recent years
- Wide distribution network and customer reach
- IPO proceeds will strengthen capital adequacy
- Exposure to India’s growing retail and MSME credit demand
Cons (Risks)
- NBFC business is exposed to credit and default risk
- Sensitive to interest rate cycles
- Highly competitive lending market
- Asset quality can deteriorate during an economic slowdown
- Valuation risk if IPO is priced aggressively
- Regulatory changes can impact NBFC operations
Who Should Consider Hero FinCorp IPO?
May consider if you:
- Want exposure to the financial services / NBFC sector
- Prefer companies with strong brand backing
- Are investing with a medium to long-term horizon
Be cautious if you:
- They are only looking for short-term listing gains
- Are uncomfortable with credit-cycle risks
- Prefer low-risk or defensive sectors
Frequently Asked Questions (FAQs)
1. What is Hero FinCorp IPO?
Hero FinCorp IPO is a public issue through which Hero FinCorp Limited plans to raise around ₹3,668 crore by issuing equity shares to the public.
2. Is Hero FinCorp profitable?
Yes. The company reported losses in FY22 but turned profitable in FY23 and FY24, with improving earnings.
3. How will Hero FinCorp use IPO funds?
The company plans to use the funds mainly to strengthen its capital base, support loan growth, invest in technology, and meet corporate needs.
4. Is Hero FinCorp part of Hero MotoCorp?
Hero FinCorp is part of the Hero Group, promoted by the Munjal family. While associated with Hero MotoCorp, it operates as a separate financial entity.
5. Is Hero FinCorp IPO good for long-term investment?
It may suit long-term investors who believe in India’s credit growth story and are comfortable with NBFC sector risks. Final judgment should be made after reviewing the valuation and asset quality in the prospectus.
Final Verdict
The Hero FinCorp IPO offers investors exposure to a large, diversified NBFC backed by a strong corporate group. With improving profitability, a growing loan book, and fresh capital infusion, the company is well-positioned for future growth.
However, as with any financial services IPO, valuation, asset quality, and economic conditions will determine long-term returns. Investors should carefully read the final prospectus before making a decision.