Hero FinCorp in talks with I-banks for Rs 4,000-crore IPO

economictimes.indiatimes.com:

Hero FinCorp, an arm of India's largest two-wheeler maker, Hero MotoCorp, has interviewed investment banks over the past two weeks as it searches for underwriters for a planned initial public offering (IPO) of shares that could raise ₹4,000 crore, according to people aware of the matter. The financing arm of the two-wheeler maker that provides retail and business loans has interviewed 7-8 investment banks that include domestic and international players. It could finalise the list of advisers soon, according to people in the know.

The proposed IPO could value the non-bank finance lender at $1.8 billion or nearly ₹14,932 crore, as per the sources. Hero FinCorp had a book value of ₹5,288 crore at the end of 2022-23. The valuation being sought is about 2.8 times the company's book value.

Moneycontrol reported on May 11 citing dealers that Hero FinCorp's shares were trading at ₹1,030 apiece or almost 2.5 times the company's book value in the unlisted market. That would give the company a value of ₹13,220 crore in the unlisted market. Hero MotoCorp did not respond to ET's queries.

Mails sent to Hero FinCorp's chief executive officer Abhimanyu Munjal also had not elicited a response until press time on Sunday. Hero MotoCorp owns around 40% stake in Hero FinCorp. The Munjal family, the promoter of Hero group, owns about 30% stake.

The rest is distributed between private equity investors such as ChrysCapital, Apollo Global, Credit Suisse and Apis Partners as well as dealers of Hero MotoCorp. The company's most recent funding took place in January last year when Hero MotoCorp and new and existing investors pumped in ₹2,000 crore as equity. Apollo Global joined the company's list of shareholders after that round, which valued the