Is Hero FinCorp facing credit risk? Is ₹310 Cr. in Pre-IPO Round a breath of relief?

13 May 2025

​Hero FinCorp, the NBFC  promoted by Hero MotoCorp, has successfully raised ₹310 cr. through a pre-IPO placement — a significant step as it waits for regulatory clearance for its ₹3,668 cr. IPO.

Hero Fincorp Pre-IPO Deal Snapshot

• Total Funds Raised: ₹310 cr.
• Mode: Pre-IPO preferential allotment
• No. of Shares Issued: 22,14,277 equity shares
• Issue Price: ₹1,400 per share (₹10 face value + ₹1,390 premium)
• Post-money Valuation: ~ ₹18,482 cr.

Despite facing rising NPAs, declining profitability, and pending regulatory approvals, Hero FinCorp attracted solid interest from reputed investors — a clear vote of confidence in its long-term story.

Key Investors & Their Contribution

Investor Name	Investment Amount (₹ Cr)
Shahi Exports	₹69 cr.
Vattikuti Ventures	₹50 cr.
RVG Jatropha Plantation	₹50 cr.
Mohan Exports (India)	₹25 cr.
Vivek, Laksh & Renu Sehgal Trust (linked to Motherson Sumi)	₹30 cr.
A P Properties	₹22 cr.
Paramount Products	₹15 cr.
Tiger Laser	₹15 cr.
Virender Uppal (Richa Exports)	₹15 cr.
LC Hercules (Cayman)	₹10 cr.
Yugal Chit Fund & Trading	₹9 cr.

Shareholding Pattern (As on 12 May, 2025):

%age Shareholding	Pre-Issue	Post-Issue
Promoter	79.48%	78.12%
Private Corporate Bodies	14.34%	15.55%
Public	5.84%	5.82%
Others	0.35%	0.51%
Total	100.0%	100.0%

Why Does This Fundraising Matter?

This capital infusion aims at strengthening Hero FinCorp’s Tier-I capital base and supporting its future lending operations. It also gives the company breathing room while it awaits SEBI’s green light for the IPO, i.e, targeting a INR 3,668 cr. IPO which includes a INR 2,100 cr. primary issue 

Looking Beyond Equity: USD 200 Mn Offshore Loan

To further shore up liquidity, the company is also raising USD 200 million (~₹1,694 cr.) through a syndicated loan led by DBS Bank. A recent roadshow in Taipei targeted international investors, following a trend seen among Indian NBFCs like Piramal Finance.

Bottom Line

The pre-IPO placement gives Hero FinCorp a short-term cushion and long-term credibility. But the path to IPO remains uncertain. Investors should track regulatory updates, asset quality trends, and offshore borrowing impact closely before making any moves.