The Initial Public Offering (IPO) of Tata Technologies has been long-awaited and is anticipated to make its debut in the market within the next few months.
Given the company’s impressive track record, obtaining approval from SEBI should not pose any challenges.
This IPO has the potential to revive the brightness of the IPO market, which has seen several major companies, including LIC and Paytm, falling short of investor expectations.
The primary market eagerly awaits an offering that can bring joy to investors.
Business focus of Tata Technologies
Tata Technologies is a global company specializing in product engineering and digital services.
It operates as a unit of Tata Motors, with Tata Motors holding a 74.68 percent stake.
The company provides services in product development and digital solutions, serving numerous global Original Equipment Manufacturers (OEMs).
With 11,000 employees and 18 global delivery centers, Tata Technologies has established itself as a significant player in the industry.
Application submission and approval status
Tata Technologies submitted its application to SEBI in March and is currently awaiting approval from the market regulator.
The IPO will be a fully Offer for Sale (OFS), meaning that no new shares will be issued.
Instead, the company’s promoters will sell their 9.57 crore shares, representing 23.60 percent of the paid-up share capital.
Details of the OFS
Tata Motors, the parent company of Tata Technologies, plans to sell its 8.11 crore shares through the OFS, equivalent to a 20 percent stake in the company.
Additionally, Alpha TC Holdings will sell its 97.16 lakh shares, while Tata Capital Growth Fund I will sell 48.58 lakh shares.
The exact size of the IPO has not been disclosed at this time.
Revenue growth and financial performance
In the nine-month period ending December 2022, Tata Technologies achieved a year-on-year revenue growth of 15 percent, generating a revenue of Rs 3,052 crore.
The services segment accounted for 88 percent of the company’s total revenue.
During this period, the company recorded a net profit of Rs 407 crores.
Unlisted market share price
In the unlisted market, Tata Technologies’ share price is currently around Rs 850.
The stock witnessed significant buying activity at around Rs 750, with its peak reaching Rs 900 at one point.
Given these figures, it is expected that the stock will debut with a substantial premium during its listing.
