Hero Motors IPO GMP at 28% ahead of September 16 issue opening; check lot size, timeline and key details

Reports coming in for today mention that Hero Motors is set to open its initial public offering (IPO) for subscription on September 16, with the offering commanding a grey market premium of nearly 29 percent ahead of the launch.

According to Investorgain, Hero Motors shares are trading at a grey market premium (GMP) of 28.57 percent. Based on the upper end of the IPO price range of Rs 84 per share, the implied stock-exchange debut price stands at around Rs 108, indicating a potential premium of around Rs 24 per share over the offering price.

The Rs 1,000-crore public offering will stay open for subscription until September 18. The price range has been set at Rs 79-84 per share, giving the firm a valuation of around Rs 3,815.4 crore at the upper end of the band.

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The IPO comprises a fresh offering of equity shares worth up to Rs 600 crore and an offer-for-sale (OFS) of shares worth up to Rs 400 crore. Promoter O P Munjal Holdings will account for Rs 395 crore of the OFS, while Hero Cycles will sell shares worth Rs 5 crore.

Following the offering, O P Munjal Holdings' stake in the firm is anticipated to decline to 49.34 percent from 70.6 percent. Hero Cycles' holding will slide to 1.56 percent from 2 percent.

The anchor portion of the offering will open for a day on September 15 for institutional market participants. The share allotment is anticipated to be completed by September 21, while the firm's shares are scheduled to debut on the bourses on September 23.

Hero Motors had filed its draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) in June 2025 and subsequently received regulatory approval in September 2025.

The firm has since revised the offering structure. The fresh offering has been trimmed to Rs 600 crore from Rs 800 crore proposed in the DRHP. The OFS composition has additionally changed, with Bhagyoday Investments withdrawing its proposed sale of shares worth Rs 5 crore. O P Munjal Holdings has boosted its OFS size by the same amount to Rs 395 crore from Rs 390 crore earlier.

Market participants can place bids for a minimum of 178 shares and in multiples of 178 thereafter. At the upper price range of Rs 84, a retail investor will need to invest at least Rs 14,952 for one lot.

The maximum investment for a retail investor, based on the applicable lot size and limit, would be Rs 1,94,376.

Hero Motors plans to deploy a significant portion of the fresh offering proceeds towards debt repayment and capacity expansion.

The firm will use Rs 190 crore to repay debt. Its total outstanding borrowings stood at Rs 289.5 crore as of July 2026.

Another Rs 200 crore from the net proceeds has been earmarked for purchasing equipment for expanding capacity at its manufacturing facility in Gautam Buddha Nagar, Uttar Pradesh.

The balance is proposed to be used for inorganic expansion through acquisitions that have not yet been identified and for general corporate purposes.

Hero Motors noted a earnings of Rs 43.6 crore for the financial year ended March 2026, marking a 72.9 percent gain from Rs 25.2 crore in the previous year.

Topline from operations rose 9.06 percent to Rs 1,188.4 crore in FY26 from Rs 1,089.6 crore in FY25.

Its customer base includes BMW AG, Ducati Motor Holding, Enviolo International Inc, Formula Motorsport, HUMMINGBIRDEV Inc and HWA AG.

ICICI Securities, DAM Capital Advisors and JM Financial are the merchant bankers managing the Hero Motors IPO.

The firm operates six manufacturing facilities across India, the United Kingdom and Thailand. It supplies engineered powertrain solutions to automotive original equipment manufacturers (OEMs) across markets including the US, Europe, India and the Association of Southeast Asian Nations (ASEAN).