Hero Motors Ltd is seeking a valuation of about ₹3,815 crore in its ₹1,000-crore initial public offering, pricing the September 16-18 issue at ₹79-84 a share as the Pankaj Munjal-led automotive-components maker raises capital to cut debt and expand powertrain capacity. Of the offer, ₹600 crore is a fresh issue, while ₹400 crore, or 40 per cent, will go to selling shareholders, including ₹395 crore to promoter O P Munjal Holdings and ₹5 crore to Hero Cycles.
The IPO comes as Hero Motors increasingly pivots towards electric powertrains and bets on a recovery in Europe’s e-bike market. E-mobility revenue jumped 55.6 per cent to ₹273.29 crore in FY26, raising its share of revenue to 23 per cent from 16.1 per cent.
The growth, however, comes against a 46.2 per cent fall in US revenue and low utilisation at some newer facilities, leaving investors to weigh a fast-growing EV portfolio against the challenge of converting capacity built ahead of demand into returns.
“We are not just the manufacturing partner; we are a technology partner,” Chairman Pankaj Munjal said, as Hero Motors moves up the value chain from supplying components to designing, developing and integrating powertrain systems.
The company will use ₹190 crore of the fresh proceeds to repay or prepay borrowings and ₹200 crore to buy equipment for expanding capacity at its Gautam Buddha Nagar facility in Uttar Pradesh. The underlying machinery programme is estimated at about ₹228 crore and includes 26 machines.
Powertrain solutions have meanwhile overtaken the company’s legacy alloys and metallics operations. Powertrain revenue rose 19.4 per cent to ₹637.75 crore in FY26, accounting for 53.7 per cent of revenue.
EVs now contribute 23 per cent of Hero Motors’ revenue, while management said roughly 80 per cent of its R&D spending is directed towards EV and hybrid technologies. The company spends about 7 per cent of revenue on R&D, including design, testing and validation of powertrain systems.
Europe provides another growth lever. European revenue jumped 28.8 per cent to ₹399.22 crore in FY26, helping offset the sharp US decline. Management said the region’s e-bike industry, hit by a severe post-Covid inventory correction, began clearing excess stocks last year and has returned to growth.
“Powertrain solutions have grown much more, and we have added more customers,” Managing Director and CEO Amit Gupta said. “Our overall strategy is to diversify going forward.”
Hero Motors enters the IPO with FY26 revenue up 9.1 per cent to ₹1,188.35 crore and net profit up 25.5 per cent to ₹41.17 crore. EVs are already nearly a quarter of its business; the harder part now is filling the capacity built for that transition and making those investments deliver returns.
Published on September 10, 2026
