Tata Technologies IPO: Get All Details On Price Band, Valuation, Analysis, And What The Latest GMP Suggests

Tata Technologies IPO: The three-day initial public offering (IPO) of Tata Technologies Ltd will open for subscription on November 22, 2023. Investors can place bids for the highly awaited Tata Technologies IPO till November 24, 2023. The Tata Group company has fixed the price band of the public issue at Rs 475 to Rs 500 per piece level.

Tata Technologies IPO is the first IPO from the Tata Group in almost two decades. The company is looking to raise Rs 3,042 crore via this public issue.

Tata Technologies, a subsidiary of Tata Motors and Tata Investment Corporation is a provider of software solutions for automakers.

Experts believe that Tata Investment Corporation has an opportunity for value unlocking from Tata Technologies IPO. The news of the public issue has generated a positive outlook for Tata Investment Corporation, contributing to the impressive rise in its share price.

Tata Technologies IPO Reservation

Tata Technologies IPO GMP Today: In the grey market, the stock is commanding a premium of up to Rs 350. According to market observers a dip of Rs 17 should not be a concern for investors as Tata Technologies IPO GMP is still near 70% of Tata Technologies IPO price band.

Tata Technologies Lot Size:

A bidder will be able to apply in lots and one lot will comprise 30 Tata Technologies shares.

Tata Technologies IPO dates

In the wake of T+3 schedule, tentatively, the Tata Technologies IPO allotment date is expected on November 27 or November 28, while the Tata Technologies IPO can likely get listed on November 29, 2023.

Risks: Pune-based Tata Technologies has a significant client concentration. In the last fiscal year, the top five clients contributed 73% to the firm's services revenues. Any decline in the company's revenue from these customers can likely weigh on its performance.

Valuation: At the upper end of the price band, the Tata Group company is commanding a valuation of 28.82 times its annualized earnings of the initial half of FY24. Tata Technologies has over 85% of its revenue coming from the automotive vertical.

The company's revenue jumped 36% annually between FY21 and FY23 to Rs 4,414 crore, while its operating profit grew at a compounded annual rate of 45% to R 820 crore, indicating a margin of 18.6%. The firm's operating profit margin expanded 240 basis points (bps) in the last two fiscal years.

Tata Technologies IPO Reservation:

Tata Technologies IPO has reservations for as many as five categories, according to Business Today. Besides, qualified institutional investors, an individual investor has the option to apply under non-institutional investors (over Rs 2 lakh), retail investors (up to Rs 2 lakh), Tata Motors Ltd shareholders (TML), and eligible employees of Tata Tech.

The company has reserved up to 2,028,342 equity shares of its post-offer paid-up equity share capital, for its eligible employees; up to 60,85,027 equity shares of its post offer paid-up equity share capital has been reserved for the eligible shareholders of Tata Motors Ltd.

Tata Technologies IPO Details:

The public issue is entirely an offer for sale (OFS) of 6.09 crore equity shares by the promoter and investors. Promoter Tata Motors will sell 4.62 crore equity shares worth Rs 2,313.75 crore in the OFS, while investors Alpha TC Holdings Pte Ltd will offload 97.17 lakh shares and Tata Capital Growth Fund I will sell 48.58 lakh shares.
Tata Motors' holding will drop from 66% to 55% after the IPO.