Tata Technologies Collects Rs 791 Crore From Anchor Investors Ahead of IPO

New Delhi, Nov 21: Tata Technologies, a leading provider of engineering and product development digital services, announced on Tuesday that it has raised Rs 791 crore from anchor investors ahead of its initial share-sale opening on the following day. This marks a significant milestone for the company as it prepares to enter the capital markets.

First Tata Group IPO in Two Decades

Notably, Tata Technologies will be the first company from the Tata Group to float an Initial Public Offering (IPO) in nearly two decades. The last IPO from the group was Tata Consultancy Services (TCS) in 2004. The upcoming IPO of Tata Technologies has generated considerable interest among investors, reflecting the strong reputation and growth potential of the company.

Anchor Investors

The company has allotted 1.58 crore equity shares to 67 funds at Rs 500 apiece, which is also the upper end of the price band. Several prominent investors have participated as anchor investors, including Goldman Sachs Singapore Pte, Copthall Mauritius Investment Ltd, and Government Pension Fund Global. Domestic mutual funds and insurance companies have also shown strong interest in the anchor book, with SBI Mutual Fund MF, ICICI Prudential MF, Nippon India MF, Kotak MF, Axis MF Bandhan MF, Edelweiss MF, Sundaram MF, SBI Life Insurance Company, and HDFC Life Insurance Company among the notable participants.

Public Issue Details

The maiden public issue of Tata Technologies will open for public subscription on November 22 and conclude on November 24. The price band for the issue has been set at Rs 475 to Rs 500 per share. The issue comprises entirely an Offer For Sale (OFS) of 6.08 crore equity shares. Under the OFS, Tata Motors will offload 4.63 crore shares, representing an 11.4 percent stake, private equity firm Alpha TC Holdings will sell 97.17 lakh shares or 2.4 percent stake, and Tata Capital Growth Fund I will divest 48.58 lakh shares or 1.2 percent of the shareholding.

Fund Raising and Employee Reservation

The issue is expected to fetch Rs 2,890.4 crore and Rs 3,042.5 crore at the lower and upper end of the price band, respectively. The company has reserved 20.28 lakh shares in the IPO for its employees and 60.85 lakh shares for Tata Motors shareholders, reflecting its commitment to employee welfare and rewarding its loyal shareholders.

Strategic Partnership with TPG Rise Climate

Last month, Tata Motors signed a pact to sell a 9.9 percent stake in Tata Technologies to TPG Rise Climate for Rs 1,613.7 crore. This strategic partnership is aimed at accelerating the company's growth initiatives and leveraging TPG Rise Climate's expertise in sustainable technologies.

Book-Running Lead Managers and Listing Details

JM Financial, Citigroup Global Markets, and BofA Securities are acting as the book-running lead managers to advise Tata Technologies on the IPO. The equity shares of the company will be listed on the BSE and the NSE on December 5, subject to regulatory approvals.

The successful anchor investor allocation of Tata Technologies reflects strong investor confidence in the company's growth prospects. As the first Tata Group company to launch an IPO in nearly two decades, Tata Technologies is poised to make a significant impact on the capital markets. The upcoming public issue provides an opportunity for investors to participate in the growth journey of this leading engineering and product development services provider.