Table of Contents
Introduction
As anticipated, the Tata Technologies IPO (Initial Public Offering) proved to be a huge success for the Tata Group. The IPO opened on November 22nd and on November 24th, the last day of bidding, bids were received for 312.65 crore equity shares, valued at Rs 1.56 lakh crore at the upper price band, against an issue size of 4.5 crore.
A record number of applications for the IPO (Initial Public Offering) of Tata Technologies Ltd., a subsidiary of Tata Motors, has been received, indicating a positive response from investors. The Rs 3,042.51-crore offer saw 69.43 times subscription on the last day.
On Thursday, November 30, 2023, the allotment for the Tata Technologies IPO is anticipated to be completed. The tentative listing date for the Tata Technologies IPO is Tuesday, December 5, 2023, on the BSE and NSE. The pricing range for Tata Technologies IPO is Rs 475 to Rs 500 per share. An application must have a minimum lot size of thirty shares. Retail investors are obliged to invest a minimum of Rs 15,000.
Future Price Estimates for the Tata Technologies IPO
Market watchers noted that Tata Technologies IPO GMP, or grey market premium, surged to Rs 405 per share today, 81% higher than the issue price. Based on the current GMP and the issue price, it is estimated that Tata Technologies shares will be listed on the stock exchanges for Rs 905 a share.
Financial Summary of Tata Technologies
Global engineering services provider Tata Technologies provides turnkey solutions, product development, and digital solutions to original equipment manufacturers worldwide. The company serves clients in industries like heavy machinery, transportation, and aerospace by leveraging its domain expertise in the automotive sector.
Revenue increased at a compound annual growth rate (CAGR) of 30% between F.Y. 21 and F.Y. 23. This resulted in a 46% CAGR in EBITDA and a 61.5% CAGR in profit after taxes. The business is still debt-free. F.Y. 23 saw a 25% increase in revenue to Rs 4,418 crore and a 63% increase in profit after taxes to Rs 708 crore.
Over the previous three years, Tata Technologies’ revenue CAGR has greatly outpaced that of Tata Elxsi, L&T Technologies, and KPIT Technologies. At 23.7%, its EBITDA margin is still roughly in line with industry norms.
Conclusion
Similar to any other business, there may be some worries about things like being dependent on a small number of very important customers and outside vendors, the risk of doing business overseas, and a cutthroat industry.
However, given the comparatively lower valuations, we think Tata Technologies is well-positioned to take advantage of the growth prospects in the automotive and aerospace sectors, the IPO seems to be a great investment for the investors.
