Hero MotoCorp To Invest Up To Rs 700 Cr In Hero FinCorp

The nation’s largest two-wheeler maker, Hero MotoCorp Limited, stated last year that its board had approved an investment of up to INR700 crore in Hero FinCorp Limited (HFCL). The two-wheeler major said in a regulatory filing “the investment was subject to the execution of definitive documents and the completion of certain conditions accepted for a transaction of this nature”. 

Hero FinCorp Limited is a non-banking financial company (NBFC) that primarily deals in financing retail and corporate customers through products including term loans, two-wheeler financing, working capital loans, bill discounting, loans against property, leasing, etc. Their motto is simple and straight, “Finance Made Easy,” and according to Mr Abhimanyu Munjal, the MD & CEO of Moto FinCorp Limited, the company aims to become Next Generation, ultra-lean, and credit champion. The goal and motivation of the finance company were to be set in  1991, and it has managed to spread and has over 2000 retail touchpoints across India presently. As of 2022, the company was in the process of raising capital of up to INR 2,000 crore through private placement for its business purposes, and Hero MotoCorp Limited’s investment of INR 700 crore was towards participation in this capital raise round. 

“The exact shareholding of Hero MotoCorp in HFCL post the investment will be determined upon completion of capital raise round by HFCL,” MotoCorp Limited said. Before the proposed investment, the two-wheeler manufacturer’s shareholding in Moto FinCorp Limited stood at 41.2 per cent. If you want to check out Hero FinCorp Limited unlisted shares price and its key performance indicators, Stockify is one of the most trusted platforms.

Hero MotoCorp Limited’s Other Investment Plans

Hero MotoCorp Limited, the parent company of Hero FinCorp Limited, is an Indian multinational motorcycle and scooter manufacturer formerly known as Hero Honda. It is one of the world’s largest two-wheelers manufacturers, where the company makes up 37.1% of the two-wheeler industry share market in India. 

Hero MotoCorp Limited did not stop its investment with Hero FinCorp Limited and went on to invest 60 million dollars in Zero Motorcycles. The bike and scooter maker company announced in September 2022 that it would invest in California-based Zero Motorcycles to develop electric motorcycles. The collaboration, according to the company, would focus on co-developing electric motorcycles. In this regard, the company stated, “This investment is not a related party transaction. No promoter/promoter group/group companies have any interest in the entity in which the investment is being made.”  

The two-wheeler manufacturer’s investment announcement in Zero Motorcycles came after the company announced an investment of more than 56 million dollars in electric vehicle start-up Ather Energy (India’s top electric scooter maker by revenue). 

The company also partnered with state-run Hindustan Petroleum Corp earlier that month to set up EV charging infrastructure across the country. Keeping its vision clear, “Be the Future of Mobility,” Hero MotoCorp, with a range of organic and inorganic collaboration initiatives, is addressing the electric mobility domain. 

Hero MotoCorp Future Plans

The motorcycle and scooter manufacturing company launched its first electric vehicle in March 2022. Being India’s largest two-wheeler manufacturer, it has been working on its ambitious first-ever vehicle project for a very long time. Its investment in multiple electric vehicle manufacturing companies is one of the most prominent steps. On the company’s electric vehicle rollout, Niranjan Gupta, CFO of the company, stated, “Hero MotoCorp Limited would eventually cover all segments of electric vehicles whether it is a premium, mid or mass category as the company’s objective is to enable electrification for everyone.”

Particulars (in crores)March 22March 21March 20
Share Capital64.415955.39
Reserve & Surplus15718.5115139.4314081.01
Net Worth15782.9215198.4314136.40
Net Block5806.485988.416117.08
Total Current Assets 4797.025236.384068.33
Total Current Liabilities5931.106962.624612.93
Net Current Assets-1134.08-1726.24-544.60

Hero MotoCorp made the investment decision on Hero FinCorp Limited for multiple reasons, including high capital gains by investing in the financing company. 

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