Tata Technologies IPO price band set at Rs. 475-500
Tata Technologies has announced the price range for its initial public offering (IPO) at Rs. 475-500 per equity share of face value of Rs. 2. The IPO is set to open for subscription on November 22 and close on November 24, with the anchor book launching on November 21. The lot size is 30 shares and in multiples of 30 shares thereafter. Through this public issue, the company aims to raise approximately Rs. 3,042.51 crore at the upper price band.
IPO details and allocation
The IPO is fully an Offer For Sale (OFS) of up to 6,08,50,278 equity shares for cash. The firm has allocated no more than 50% of the shares for Qualified Institutional Buyers (QIB), no less than 15% for Non-Institutional Investors (NII), and no less than 35% for Retail Investors. Furthermore, an employee reservation portion of up to 20,28,342 equity shares has been set aside, along with a portion reserved for Tata Motors shareholders, totaling 60,85,027 equity shares.
Tentative dates and listing
Tata Technologies aims to finalize share allotment by November 30. On December 4, allotted shares will be credited to investors' demat accounts, while refunds for non-allottees are slated for December 1. The IPO is scheduled for listing on both BSE and NSE by December 5. If the firm opts for T+3 norms, the dates will be moved up.
Grey market premium and estimated listing price
The grey market premium (GMP) for the Tata Tech IPO currently stands at Rs. 298 apiece, as per investorgain.com. Taking into account the upper limit of the IPO price range and the current premium in the grey market, the projected listing price for Tata Tech shares is around Rs. 798 apiece. This is nearly 60% higher than the IPO price of Rs. 500.
About the company and past year's performance
Established in 1994, Tata Technologies Limited is a prominent global engineering services firm specializing in product development and digital solutions. They provide comprehensive services, including turnkey solutions, to worldwide original equipment manufacturers (OEMs) and tier-1 suppliers. The company reported a 42.8% YoY increase in consolidated net profit at Rs. 624 crore for the fiscal year ending March FY23 and a 25% increase in revenue from operations at Rs. 4,414.2 crore during the same period.
Publicly traded industry peers
The company's publicly traded industry peers include KPIT Technologies Ltd. with a price-to-earnings ratio (P/E) of 77.83, and L&T Technology Services Ltd. with a P/E of 37.31. Tata Technologies's P/E based on diluted earnings per share (EPS) for the financial year 2023 at the cap price is 32.53 times and at the floor price 30.90 times.
