Hero Motors Makes Muted Market Debut; Shares Bounce Back Later

Shares of auto components maker Hero Motors on Wednesday made a muted market debut, listing over 2% lower against the issue price of ₹84.

The stock started trading at ₹82.10, a discount of 2.26% from the issue price on the BSE.

At the NSE, the stock made its debut at ₹82, down 2.38%.

Later, it bounced back and traded 17.27% higher at ₹98.51 on the BSE.

The company's market valuation stood at ₹4,433.14 crore.

The initial public offering of Hero Motors was subscribed 6.66 times on the final day of bidding on Friday last week.

The ₹1,000-crore IPO had a price band of ₹79-84 per equity share.

The mainboard issue had a fresh issuance of equity shares, aggregating up to ₹600 crore, and an Offer-for-Sale (OFS) of shares worth up to ₹400 crore.

Of the fresh issue proceeds, ₹190 crore will be used for repayment or prepayment of certain outstanding borrowings, while ₹200 crore will be utilised for purchasing equipment required for capacity expansion at the company's facility in Gautam Buddha Nagar, Uttar Pradesh.

The remaining IPO funds will be used for inorganic growth through unidentified acquisitions and other strategic initiatives, besides general corporate purposes.

Hero Motors is an automotive technology company engaged in designing, developing, manufacturing and supplying engineered powertrain solutions to automotive Original Equipment Manufacturers (OEMs) in the US, Europe, India and the Association of Southeast Asian Nations (ASEAN) region.

The company caters to several global firms, including BMW AG, Ducati Motor Holding SPA, Enviolo International Inc, Formula Motorsport Ltd and Hummingbird EV.