Hero Fincorp Limited (HFL) was formerly known as Hero Honda Finlease Limited. As per its credit rating report, it is a Non-Banking Financial Company (NBFC) engaged in extending retail finance for two-wheeler sales of HMCL, bill discounting for HMCL's suppliers, loans to small and medium enterprises, and loan against property (LAP). The company has also forayed into segments such as used car financing and personal loans. The company was incorporated in 1991 and has its registered office located in New Delhi.

Genesis

Hero Fincorp Ltd. is the financial services arm of India's largest two-wheeler maker Hero MotoCorp Ltd.

It offers a wide range of solutions including two-wheeler financing, SME Lending, Personal Loans etc.

Established in 1992 as Hero Honda FinLease Limited, Hero Fincorp underwent a name change after Hero MotoCorp acquired full ownership of 'Hero Honda' following Honda Motor Company's departure from their joint venture.

Currently, the Company’s footprint extends to nearly 2000 retail outlets | 2000 corporate clients | 1000 dealerships, spanning across 1900 cities, towns, and villages.

Rating: “AA+ with stable outlook”: by CRISIL, ICRA and CARE.

Product Portfolio

The Company provides a wide portfolio of financial products including:

Retail Loans	Corporate Loans
Two-Wheeler Loans	SME and Commercial Loans
Used-Car Loans	Supply Chain Financing
Personal Loans	Working-Capital Loans

Retail Business:

1. Two-wheeler loans: Disbursements - 1 Million (8.78 Lakh in FY22) | Total active customer base - over 2.5 Million.
2. Asset book: Rs. 8,631 Cr. | 900 dealerships as of FY23.
3. 4,100+ touch points across 2,000 cities, towns & villages.
4. Disbursing speed: 1 loan every 10 seconds.

SME & Corporate Business:

1. 75 Locations.
2. Processing Capacity: 3,000 applications per month.
3. In FY23, Rs. 7,572 Crs. worth of loans were disbursed.
4. Asset book: Rs. 12,538 Crs.

1. Embracing Digital Initiatives: Prioritizing digital initiatives to enhance customer service and promote digital EMI payments.
2. Implement Data Analytics: Utilizing data analytics to streamline loan disbursement processes and enhance loan recovery strategies to improve operational efficiency.
3. Strengthen Loan Portfolio: Implementing robust risk management practices and ensuring prudent lending practices to mitigate credit risks.

Subsidiary: Hero Housing Finance Ltd.

1. Hero Housing Finance Limited (HHFL) is a wholly owned subsidiary of HFCL subsidiary of Hero Fincorp Ltd.
2. HHFL commenced its lending operations from April, 2018. 
3. Products: Housing loans, loan against property and construction loans.
4. Revenue from Operations - FY23: Rs. 400 Crs. | FY22: 298 Crs. | Y-o-Y Growth: 34%
5. PAT - FY23: Rs. 22.63 Crs. | FY22: Rs. 2.09 Crs. | Y-o-Y Growth: 982%

Shareholding Pattern

1. Hero MotoCorp Ltd. owns around 40% stake in Hero Fincorp.
2. Pawan Munjal, chairman of Hero Fincorp, and his extended family hold nearly 10% in the NBFC in individual capacity. The family's investment firm Bahadur Chand Investments holds over 20%.
3. Apollo Global Management is estimated to have secured a 9-10% stake in the funding round held in Feb 2022.
4. Mauritius-based Otter Limited has a significant stake of 10% in Hero Fincorp. 
5. ChrysCapital, Credit Suisse and Apis Partners are the other investors in the NBFC.

Funding Information

In its latest funding round (4^th Feb 2022), Hero Fincorp Ltd. secured ₹2,000 crore ($267 million) from several investors for business expansion plans.

 

Date	Company	Investment Amount
Feb 2022	Apollo Global Management	₹937 crore ($125 million)
Feb 2022	Hero MotoCorp	₹700 crore ($94 million)

Apollo Management’s stake in Hero Fincorp post funding: 10%(Approx)

Estimated Valuation: 9370 Crs

Number of outstanding Shares: 12,73,06,674

Price Per Share: Rs. 736 (As of Feb 22)

Timeline

1. 1991-2012: Incorporated as Hero Honda Finlease Ltd. | Renamed as Hero Fincorp Ltd.
2. 2013-19: Received equity infusion of INR 106 Cr. | Launched Two-Wheeler Financing business, Used Car Business | 3000 touchpoints in 1700+ locations
3. 2020: Achieved the status of India's No.1 Two-Wheeler Financier. | Among the Top 3 NBFCs in Pre-Owned Car Loans. | Secured a fund-raising agreement of INR 1,075 Cr. from PE Investors & Promoters.
4. 2021: Launched a Customer Service App. | Introduced 'SimplyCash', a digital Loan Product.
5. 2022: Launched Partnership Loans and achieved Disbursal of INR 1,900 Cr.+ in the first year.
6. 2023: Achieved the highest-ever Disbursals  in FY23 | Launched EV Financing |  Crossed 10 Mn. Customers | Recognized as 'Great Place to Work' for the 6th year in a row.

Segment	Percentage
Retail Lending
·        Two-Wheeler Lending	23%
·        Used Car Financing	5%
·        Personal Loans	26%
·        Home Loans	7%
Retail SME Lending (which includes unsecured business loan, loan against property, supply chain finance)	19%
Corporate Lending	15%
Lending on the CROMS Platform	5%
Total	100%

Financial Highlights:

INR in Crs

  

PARTICULARS	FY24	FY23	FY22
REVENUE	8291	6402	4739
EBITDA	4055	2901	1399
PAT	637	480	-192
EPS	50	38	-15

Dividend History

Highlights:

1. FY23: AUM: INR 41,497 Crs. | FY22: AUM: INR 32,953 Crs. | Growth: 26% Y-o-Y.
2. Highest ever Loan - Disbursals of INR 27,713 Cr. (Consolidated) in FY23.
3. The Company experienced a robust 35% Y-o-Y increase in revenue in FY23.
4. PAT surged significantly, shifting from a loss of ₹190 Crs, to ₹480 | Growth: 350%.
5. In FY23, GNPAs improved to 5.38% from 7.94% in FY22 | NNPAs improved to 2.79% from 4.63% in FY22.