Hero Fincorp’s Assets under Management (AUM) reached Rs 49,127 crore by December 2023, marking a 25% YoY increase from Rs 39,381 crore recorded at the end of December 2022. “The company aims for a net profit of Rs 1,000 crore in the fiscal year 2024-25, projecting a 30% year-on-year growth” as stated by the NBFC's Joint Managing Director and CEO, Abhimanyu Munjal, on March 5.
What does Hero FinCorp do?
Incorporated in December 1991, Hero FinCorp is an Indian Non-Banking Financial Company (NBFC). Hero FinCorp was previously known as Hero Honda FinLease Ltd. when it was incorporated.
It is engaged in businesses such as leasing, financing, bill discounting, consumer finance businesses, and commercial lending. They offer retail loans, corporate loans, and loyalty loans like two-wheeler, personal, used car, commercial loans, loans against properties, unsecured business loans, medical equipment financing, working capital loans, inventory funding, etc.
Hero FinCorp Limited has a subsidiary known as Hero Housing Finance Limited that focuses on end-to-end digital lending to enable customers to have a joyful home ownership experience.
How it performed in the past 2 years
| Particulars | Dec. 2023 (Rs. Crore) | Dec. 2022 (Rs. Crore) | % Variation |
| Sales | 1985.38 | 1548.40 | 28.22 |
| OPM % | 51.59 | 42.98 | - |
| PBDT | 298.63 | 156.59 | 91 |
| PBT | 285.80 | 149.41 | 91 |
| NP | 200.43 | 87.78 | 128.33 |
As we can see, Hero Fincorp delivered impressive financial results in the quarter ending December 2023. It saw a net profit surge of over 128%. This raised the profit to Rs 200.43 crore from the previous quarter's Rs 87.78 crore.
Sales also saw a substantial increase, rising by 28.22% to Rs 1985.38 crore compared to Rs 1548.40 crore in the same period last year.
In terms of financial specifics for December 2023, the Operating Profit Margin (OPM %) experienced a positive shift, indicating that the company was able to improve its efficiency in operations.
These positive trends indicate a strong financial performance by Hero Fincorp during the quarter. It also shows that management has tried to improve operational efficiency and develop strategies to increase revenue.
Current performance prediction and its impact on IPO
Recently, Hero FinCorp started an in-house tech center in Bengaluru. This is a much-needed move, given the revolution of the finance industry’s approach to a tech-first approach.
Especially with management change like the hiring of Neetika Bhatia as CHRO, and Puneeth Bekal as CMO, it shows that the company is trying hard to change the way it does business. The effects can be seen in its quarterly reports.
CEO Abhimanyu Munjal's statement, expressing the company's ambitious goal of achieving a Rs. 1,000 crore profit mark, also adds to this forward-looking perspective. This public statement of their goal signals the management’s confidence as well.
Considering these developments, the cumulative effect is likely to enhance Hero FinCorp's market perception, positioning it favorably among investors ahead of the IPO this year. The targeted capitalization of this proposed IPO is around ₹4,000 crore.
Currently, the ownership stake of Hero FinCorp looks like:
- Hero MotoCorp owns around 40 percent stake in Hero Fincorp
- The promoters - the Munjal family own around 35-39 percent
- The remaining stake is in the hands of private equity investors such as Credit Suisse, Apollo Global, and a few dealers of Hero MotoCorp.
What does the future hold?
Hero FinCorp’s future outlook appears highly promising. The initiation of an in-house tech center works out perfectly with the evolving trend of the finance industry. This positions Hero FinCorp to leverage technology for enhanced operational efficiency and customer-centric services.
Given Hero FinCorp's optimistic future outlook and the anticipation of a mega Rs 4,000 crore IPO in 2024, investing in its unlisted shares is an enticing opportunity. You can grab it by purchasing its pre-IPO unlisted shares from Stockify.
Stockify is India’s best-unlisted shares market and is known to be one of the most secure platforms. Invest now on Stockify and secure your stake in Hero FinCorp before the IPO to position yourself for potential high returns.
