Tata Technologies IPO Subscription Last Day: The Tata Technologies IPO turned out to be a strong success for the Tata Group as the Rs 3,042.51-crore offer saw 16.22 times subscription with bids coming in for 73 crore equity shares against an issue size of 4.5 crore on November 24, the final day of subscription.
The Rs 3,042.51 crore public offer is entirely an offer-for-sale of 6.08 crore shares, which is 15 per cent of the paid-up capital. Tata Technologies IPO hit the Indian primary market on 22, November 2023. The IPO subscription will remain open till 24, November 2023 i.e. till Friday this week.
Tata Technologies IPO: Subscription Status
On Day 3, of the last day of bidding, qualified institutional buyers and high net-worth individuals (non-institutional investors), who have 50 percent and 15 percent reservation in the net issue, bought 8.62 times and 35 times their allotted portions.
Even retail investors, Tata Technologies employees and Tata Motors shareholders also looked aggressive in the offer, subscribing 12.2 times, 2.58 times and 21.63 times the portion set aside for them, which is 35 percent of the net issue, 20.28 lakh shares and 60.85 lakh shares reserved in the issue.
Tata Technologies IPO: Price Band
The three-day issue, which runs till November 24, has a price band of Rs 475-500 per share with a lot size of 30 equity shares and its multiples thereof. Analysts peg the post issue market cap between Rs 19,269 crore and Rs 20,283 crore.
Tata Technologies IPO: Important Dates
Tata Technologies IPO date of opening is 22, November 2023 and it would remain available for bidding till 24, November 2023. Tata Technologies IPO allotment date is most likely on 27, November 2023 whereas the most likely Tata Technologies IPO listing date is 29, November 2023.
Tata Technologies IPO: Lot Size
Tata Technologies IPO applicants will be able to apply in lots and one lot of the public issue would comprise 30 company shares. So, a retail investor would require at least Rs 15,000 ( Rs 500 x 30) to apply for this much-awaited public issue.
Tata Technologies IPO: About the Company
Incorporated in 1994, Tata Technologies is a global engineering services company offering product development and digital solutions, including turnkey solutions, to global original equipment manufacturers (OEM) and their tier 1 suppliers. Backed by Tata Motors, the company boasts extensive knowledge in the automotive sector and has expanded its expertise into aerospace and heavy construction machinery, enhancing its commercial opportunities. As of September 2023, it had 12,451 employees.
Tata Technologies IPO: Financials
On the financial front, the company reported a turnover of Rs 2,381 crore, Rs 3,530 crore and Rs 4,414 crore for FY21, FY22 and FY23, respectively, on a consolidated basis. It posted a net profit of Rs 239 crore, Rs 427 crore and Rs 624 crore, respectively, for the aforementioned period.
Tata Tech’s growth trajectory over FY16-23 remains slower than peers’, but has seen improvement in the last three years because of traction in select accounts. Weakness in a large client in H1FY24 due to near completion of the large full-vehicle development projects may weigh on the company’s near-term performance which, is adequately captured in the IPO valuations, Emkay Global said in a note.
Tata Technologies IPO: GMP
Tata Technologies IPO shares traded at a 80 percent premium over the upper price band, increasing from 70 percent premium couple of days back, in the grey market, analysts on anonymity said. The grey market is an unofficial platform for trading in the IPO shares till the listing.
Generally, investors make use of the grey market premium to guess the expected listing price of any IPO.
Tata Technologies IPO: Should you Invest?
Giving ‘subscribe’ tag to Tata Technologies IPO Ventura said, “With the gradual recovery in the global economy, rising manufacturing capex and shift in manufacturing from US/Europe/China to India due to cost inflation and China+1 strategy, we are expecting strong in the TTECH’s financial performance in the coming years. At the IPO price of INR 500 (upper price band), TTECH is valued at a TTM P/E of 28.3X. Considering the growth opportunities and strong fundamentals of TTECH, we recommend a SUBSCRIBE rating for this IPO.”
Atul Parakh CEO of Bigul, said: “TATA Technologies will be the IPO to monitor in the coming week, as everyone has been expecting. The IPO has a face value of Rs 2 and a reasonable valuation comfort compared to its peers KPITTECH and TATAELXI.”
“TATA also backs the company, which has good financials and potential. Investors’ interest is also influenced by the possibility of large listing gains, which is a big element in retail interest in the company.”
Under the IPO, Tata Technologies is available at a discount to its peers, according to IIFL Securities. The IPO valuation implies a trailing PE of 28 times as against 30-90 times for pure-play India-based peer ER&D service providers, the brokerage said in a research note.
“We believe that industry tailwinds for the automotive industry are likely to continue to drive growth for the company in the medium term, while expansion into adjacencies provides upside risks. We recommend subscribing to the IPO, given the valuation discount to peers,” said IIFL Securities, which had assigned a ‘subscribe’ rating to the Tata group issue.
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