Hero Fincorp
Issue details
- Listing at
- NSE
- CIN
- U74899DL1991PLC046774
- Registered office
- 34, Community Centre, Basant Lok Vasant Vihar, New Delhi 110 057, Delhi, India
Company financials
₹ crore unless a row shows % or ×, as reported in the offer document
| Period ended | FY25 | FY24 | FY23 |
|---|---|---|---|
| Profit and loss | |||
| Total income | 9,903.33 | 8,359.73 | 6,447.55 |
| Revenue from operations | 9,832.73 | 8,290.9 | 6,401.59 |
| Other income | 70.6 | 68.82 | 45.95 |
| Total expenses | 9,647.24 | 7,399.18 | 5,712.32 |
| Operating profit | 256.09 | 960.55 | 735.22 |
| Operating margin | 2.59% | 11.49% | 11.40% |
| Profit before tax | 256.09 | 960.55 | 735.22 |
| Profit after tax | 109.95 | 637.05 | 479.95 |
| PAT margin | 1.11% | 7.62% | 7.44% |
| Balance sheet | |||
| Total assets | 60,042.39 | 53,204.66 | 43,451.23 |
| Current assets | 58,901.02 | 52,264.93 | 42,716.87 |
| Current liabilities | 54,109.58 | 47,247.05 | 38,081.48 |
| Total liabilities | 54,281.63 | 47,432.63 | 38,203.4 |
| Net worth | 5,760.76 | 5,772.03 | 5,247.83 |
| Current ratio | 1.09× | 1.11× | 1.12× |
| Return on equity | 1.91% | 11.04% | 9.15% |
| Cash flow | |||
| Operating cash flow | -3,913.66 | -9,238.83 | -6,918.52 |
| Investing cash flow | -593.15 | -129.79 | -474.13 |
| Financing cash flow | 6,372.63 | 8,717.26 | 7,268.3 |
| Net cash flow | 1,865.82 | -651.36 | -124.35 |
Objects of the issue
Stated use of the net proceeds— open a row for the issuer's full explanation
1 Augmentation of Capital Base ₹1,790 Cr
The IPO is intended to strengthen the capital base of the company to support future growth and enhance capital adequacy, enabling expansion of its lending portfolio across retail, MSME and corporate segments.
2 Funding Business Expansion and Lending Activities —
The proceeds are planned to be used to fund incremental capital requirements arising from the growth of the company’s financing, lending and related financial services businesses across multiple product categories.
3 Offer for Sale by Existing Shareholders ₹1,568 Cr
A portion of the IPO consists of an offer for sale, allowing certain existing shareholders to monetize part of their investment without providing proceeds to the company.
1 of 3 objects carry no stated amount — typically general corporate purposes, funded from whatever remains — so the total above is the quantified portion only, not the whole issue.
About Hero Fincorp
Hero FinCorp Limited, incorporated in December 1991 as Hero Honda Finlease Limited and renamed Hero FinCorp Limited in 2011, is a non-banking financial institution registered with the RBI. The company operates as an NBFC-Middle Layer under RBI regulations and offers a diversified product portfolio across retail finance (vehicle loans, personal loans, mortgage loans), MSME finance, and corporate/institutional finance. It serves retail and micro, small and medium enterprises customer segments through a pan-India distribution network comprising in-house capabilities and partnerships. The company has built a strong liability franchise with access to low-cost borrowing and maintains a credit rating of AA+.
Management
Abhimanyu Munjal
MD
Kaushik Dutta
Director
Sajin Mangalathu
CFO
Priya Kashyap
COO
Ajay Sahasrabuddhe
Director
Strengths
As stated in the offer document
Diversified Non-Banking Financial Platform
The company is positioned as a scaled non-banking financial institution with a diversified product portfolio catering to retail, MSME and corporate customer segments, reducing concentration risk and supporting stable growth.
Strong Promoter Heritage
The company benefits from the established Hero legacy, which supports brand credibility, customer trust and long-term relationships across its lending and financial services businesses.
Pan-India Distribution Network
The company has built a wide pan-India distribution network combining in-house capabilities and partnerships, enabling broad customer reach and efficient sourcing across geographies.
Customer-Centric Business Model
The company follows a customer-focused approach with strong cross-sell potential, allowing multiple products to be offered across the customer lifecycle and improving customer retention.
Integrated Technology and Data-Driven Operations
The company operates on a well-integrated technology platform across functions, supported by data analytics to enhance underwriting, customer acquisition, servicing and operational efficiency.
Robust Risk Management and Collections Framework
The company has established prudent risk management practices, robust underwriting standards, advanced analytics and a strong collections infrastructure to manage asset quality.
Strong Liability Franchise and Credit Profile
The company benefits from access to diversified funding sources, relatively low-cost borrowings and strong credit ratings, supporting sustainable balance sheet growth.
Consistent Business Growth and Financial Performance
The company has demonstrated consistent business expansion and financial performance, supported by diversified lending segments and disciplined capital allocation.
Experienced Management and Governance
The company is led by an experienced management team, supported by a respected board and marquee investors, strengthening governance and strategic execution.
Risk factors
As stated in the offer document
Regulatory Proceedings Against Promoters and Reputational Risk
The company's promoters, including Chairman Dr. Pawan Munjal and Managing Director Abhimanyu Munjal, are subject to ongoing regulatory proceedings related to alleged violations of the Prevention of Money Laundering Act and Customs Act involving ₹8.10 million in undeclared foreign currency. These proceedings, along with searches conducted at the company's corporate office and seizure of documents, may lead to significant reputational risks and potential adverse outcomes that could impact the company's business operations and market position.
Enforcement Directorate Proceedings and Uncertain Legal Outcomes
The company faces ongoing Enforcement Directorate proceedings under the Prevention of Money Laundering Act related to alleged illegal export of foreign currency totaling ₹540.00 million, with the matter scheduled for hearing on February 5, 2026. The company cannot assure that these proceedings will be decided favorably or that no liability will be imposed, creating uncertainty around potential financial penalties and operational disruptions.
Asset Seizure and Document Retention by Regulatory Authorities
Regulatory authorities have seized and retained the company's documents, properties, and other assets following searches at corporate offices and promoter residences in connection with money laundering investigations. While some seized materials have been ordered for release, ongoing appeals and retention of certain documents may impact the company's operational capabilities and access to critical business records.
Company Analysis
from PROSPECTUSHero FinCorp Limited is a scaled non-banking financial company offering diversified retail and MSME lending products across India.
Hero FinCorp Limited, incorporated in December 1991 as Hero Honda Finlease Limited and renamed Hero FinCorp Limited in 2011, is a non-banking financial institution registered with the RBI. The company operates as an NBFC-Middle Layer under RBI regulations and offers a diversified product portfolio across retail finance (vehicle loans, personal loans, mortgage loans), MSME finance, and corporate/institutional finance. It serves retail and micro, small and medium enterprises customer segments through a pan-India distribution network comprising in-house capabilities and partnerships. The company has built a strong liability franchise with access to low-cost borrowing and maintains a credit rating of AA+.
Objects of the Issue
- Not explicitly stated in this part of the document
Issue Structure
- Total Issue
- ₹33,581.35 million
- Fresh Issue
- ₹17,900.01 million
- Offer for Sale
- ₹15,681.34 million
- Price Band
- [●] (to be determined)
- Lot Size
- [●] (to be determined)
- Face Value
- ₹10 per equity share
Business Model
Hero FinCorp earns revenue primarily through interest income on loans disbursed to retail and MSME customers, with additional income from fees and other sources. As of September 30, 2025, the company had AUM of ₹5,81,625.35 million comprising 62.02% retail finance, 24.53% MSME finance, and 10.00% corporate/institutional finance. The company finances loans through borrowings from banks, NCDs, ECBs, commercial papers, and perpetual debt instruments.
Business Segments
SWOT Analysis
- • Scaled NBFC with diversified product offerings(p.8)
- • Strong Hero heritage and brand recognition(p.8)
- • Pan-India distribution with in-house and partnership capabilities(p.8)
- • Data-driven operations and integrated technology platform(p.8)
- • Prudent risk management and strong collections infrastructure(p.8)
- • Strong liability franchise and access to low-cost borrowing(p.8)
- • Experienced management team and marquee investors(p.8)
- • Large digital platform with significant user engagement(p.58)
- • Strong expansion of IT and analytics capabilities(p.58)
- • High proportion of salaried borrowers in Retail Finance reducing credit risk(p.58)
- • Portfolio dominated by high-quality vehicle loans with strong borrower creditworthiness(p.57)
- • Diversified geographic presence across regions(p.65)
- • Established diversified loan portfolio with strong origination capabilities(p.174)
- • Significant equity stake and support from promoter Hero MotoCorp Ltd(p.161)
- • Strong derivative financial instruments management for risk mitigation(p.119)
- • Substantial gross loan portfolio of ₹553,952.45 millions(p.122)
- • Primarily secured loan book with 61.6% secured by tangible assets(p.122)
- • Active capital management and RBI regulatory compliance(p.195)
- • Robust credit risk monitoring and portfolio governance(p.202)
- • Well-structured collateral security framework across products(p.209)
- • Diversified funding sources via multiple channels(p.211)
- • High GNPA ratio relative to peer group(p.12)
- • Deteriorating profitability with negative PAT in H1 FY2026(p.12)
- • Declining ROE from 11.57% to 1.91% over two years(p.12)
- • Decelerating AUM growth to 4.53% in H1 FY2026(p.12)
- • Significant regulatory proceedings involving promoters and company(p.6)
- • Potential inquiry regarding equity capital build-up and shareholder proliferation(p.7)
- • High leverage with Debt-to-Equity of 8.55x(p.12)
- • Recent deterioration in profitability with loss in current period(p.91)
- • High leverage with debt-to-equity ratio of 8.55x indicating significant financial risk(p.81)
- • Deteriorating asset quality with GNPA ratio increasing to 5.05%(p.80)
- • Rising impairment provisions indicating credit quality stress(p.91)
- • Declining digital customer acquisition amid portfolio shift(p.58)
- • High impairment loss allowance of ₹21,212.56 millions on gross loans (3.8% of portfolio)(p.122)
- • Significant settlement losses and bad debts written off of ₹14,996.39 millions in current period(p.170)
- • High debt burden with subordinated liabilities of ₹53,596.32 millions including CCPS fair value losses(p.152)
- • Negative profit for the period ended September 30, 2025 of ₹(1,310.66) millions(p.173)
- • Significant reliance on external commercial borrowings at ₹79,546.39 millions with FX exposure(p.142)
- • Title deed issue on immovable property with original conveyance deed untraceable(p.130)
- • High concentration of Stage 3 (non-performing) loans(p.206)
- • Significant reliance on borrowings for funding composition(p.197)
- • Substantial interest rate risk on floating rate assets and liabilities(p.213)
- • High exposure to foreign currency risk via external borrowings(p.214)
- • Significant tax disputes pending across assessment years(p.231)
- • Large and attractive retail and MSME customer segments(p.8)
- • Cross-sell expansion with customer franchise of 13.21 million(p.8)
- • Growth in MSME finance from 20.31% to 24.53% of AUM(p.12)
- • Mortgage loans segment growing rapidly at 25.18% CAGR(p.55)
- • Digital adoption providing competitive advantage with 88.46% digital collections(p.13)
- • Expansion into new product verticals with 4.93 products per customer(p.13)
- • Increasing digital collection penetration enabling operational efficiency(p.58)
- • Growth in customer service digitalization reducing cost-to-serve(p.58)
- • Expansion of housing finance subsidiary as complementary business vertical(p.103)
- • Growing mortgage loans portfolio with strong collateral backing(p.62)
- • MSME financing growth with diversified loan structure across secured and unsecured segments(p.65)
- • Expanding housing finance business through Hero Housing Finance Limited subsidiary(p.174)
- • Growing emerging corporates and SME lending segments(p.174)
- • Refinance facility from National Housing Bank with ₹5,721.20 millions available(p.142)
- • Technology infrastructure development with intangible assets under development of ₹257.50 millions(p.133)
- • Expansion through direct loan assignments to manage leverage(p.218)
- • Growth via employee stock option schemes increasing human capital(p.220)
- • Derivative instruments for managing foreign exchange and interest rate risk(p.214)
- • Regulatory proceedings involving promoter for alleged money laundering(p.6)
- • Ongoing ED proceedings regarding alleged illegal currency export(p.6)
- • ED show cause notice regarding collateral security attachment for customer loan(p.7)
- • Risk of inquiry regarding equity capital build-up due to shareholder proliferation(p.7)
- • Potential penalties and share cancellation from equity capital inquiries(p.7)
- • NBFC sector regulatory and competitive pressures(p.8)
- • Volatility in credit costs as reflected in rising impairment ratios(p.79)
- • Compression in net interest margins indicating pricing pressure(p.77)
- • Increased competition in retail finance reducing customer acquisition efficiency(p.68)
- • Dependence on wholesale funding exposing company to market volatility(p.68)
- • Regulatory pressure on capital requirements for non-banking financial entities(p.103)
- • Rising regulatory capital requirements and RBI compliance framework(p.165)
- • Income tax litigations with appeals pending aggregating ₹1,090.30 millions(p.186)
- • External commercial borrowing exposure to foreign exchange rate risk(p.116)
- • Interest rate sensitivity on variable rate debt affecting financing costs(p.142)
- • Concentration risk with Hero MotoCorp Ltd as 40.45% shareholding and key customer source(p.161)
- • Regulatory capital adequacy requirements and RBI compliance obligations(p.195)
- • Systemic liquidity risk and market funding disruption exposure(p.211)
- • Macroeconomic sensitivity via consumer defaults and employment cycles(p.204)
- • Enforcement actions by authorities affecting asset enforcement capability(p.236)
- • Litigation and regulatory penalties impacting operational continuity(p.236)
Promoters
| Name | Role | Pre-Issue | Post-Issue |
|---|---|---|---|
| HERO MOTOCORP LIMITED | Corporate Promoter | — | — |
| BAHADUR CHAND INVESTMENTS PRIVATE LIMITED | Corporate Promoter | — | — |
| HERO INVESTCORP PRIVATE LIMITED | Corporate Promoter | — | — |
| DR. PAWAN MUNJAL | Individual Promoter | — | — |
| RENU MUNJAL | Individual Promoter | — | — |
| SUMAN KANT MUNJAL | Individual Promoter | — | — |
| RENUKA MUNJAL | Individual Promoter | — | — |
| ABHIMANYU MUNJAL | Individual Promoter | — | — |
| Hero MotoCorp Limited | Promoter | 41.19% | 40.45% |
| Bahadur Chand Investment Private Limited | Promoter | 20.34% | 19.98% |
| Brijmohan Lal Om Parkash (Partnership Firm) | Promoter Group | 9.52% | 9.35% |
| Hero Investcorp Private Limited | Promoter | 2.70% | 2.65% |
| Dr. Pawan Munjal | Promoter/Chairman | — | — |
| Renu Munjal | Promoter/Whole-time Director | — | — |
| Hero MotoCorp Limited | Promoter/Corporate Promoter | — | — |
Leadership
Auto-extracted from the company's PROSPECTUS using AI, with each fact linked to its source passage (hover any row to see the quote & page). Provided for research only, not investment advice — verify against the official PROSPECTUS before relying on it.