Hero Motors Shares Recover 17% After Weak Market Debut

Hero Motors had a muted start on the stock exchanges on September 23, but the stock recovered sharply soon after listing. 

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The shares opened at ₹82 on the NSE, 2.38% below the IPO price of ₹84. On the BSE, the debut was at ₹82.10, a discount of 2.26%. 

By 10:45 am, however, the stock had climbed to ₹95.98, up 17.05% from its NSE listing price. Following the debut, Hero Motors’ market capitalisation stood at around ₹3,729.11 crore. (moneycontrol.com) 

The ₹1,000 crore IPO had received bids for 58.97 crore shares against 8.86 crore shares on offer. 

The retail portion was subscribed 8.23 times, while non-institutional investors subscribed 9.86 times. The qualified institutional buyer category was booked 1.49 times. 

Hero Motors had fixed the issue price band at ₹79-84 per share. The offer included a fresh issue of ₹600 crore and an offer for sale worth ₹400 crore. (moneycontrol.com) 

Before the public issue opened, the company raised nearly ₹300 crore from anchor investors through the allotment of 3.57 crore shares at ₹84 apiece. 

The anchor book included Societe Generale, ICICI Prudential AMC and 3P India Equity Fund. Domestic mutual funds received 2.91 crore shares through 16 schemes, while ICICI Prudential Life Insurance and Edelweiss Life Insurance were also among the anchor investors. (moneycontrol.com) 

Hero Motors plans to use ₹190 crore from the fresh issue for repayment or prepayment of certain borrowings. 

Another ₹200 crore has been set aside for purchasing equipment to expand capacity at its facility in Gautam Buddha Nagar, Uttar Pradesh. 

The remaining proceeds are intended for inorganic growth opportunities, strategic initiatives and general corporate purposes. (moneycontrol.com) 

Hero Motors designs and manufactures powertrain solutions for automotive original equipment manufacturers and has operations across India, the US, Europe and the ASEAN region. 

The September 23 listing began below the issue price, but the stock’s early trade quickly reversed that initial weakness, moving above both the listing price and the IPO price within the first hour.