Tata IPO: 9 Points Revealing Gold and Brass – Benefits and Risks Unveiled
The Tata Technologies IPO is set to open in just a few days. After almost two decades, the Tata Group’s new company will enter the stock market with its IPO. Tata Group’s shares have gained the highest confidence among global investors, thanks to its diverse range of companies that have consistently delivered strong performance over the years. Investors are eagerly anticipating Tata Technologies’ IPO, and this article breaks down the key details to help you make an informed decision.
IPO Date
Tata Technologies’ IPO is scheduled to open on November 22 and will accept bids until November 24.
Price Band
The price band for Tata Technologies’ shares is set between ₹475 and ₹500 per share. Typically, in successful IPOs, shares are allotted at a price higher than the upper limit of the band, allowing for potential gains. The company’s valuation for this IPO stands at ₹20,283 crores.
IPO Size
The total size of Tata Technologies’ IPO is approximately ₹3,042.51 crores. This IPO is entirely an Offer for Sale (OFS), meaning the company is not issuing any new shares. Existing shareholders will sell their shares through OFS, and the proceeds go to them, not the company. Tata Technologies is not raising any fresh capital through this IPO.
Tata Motors’ Share in IPO Proceeds
Tata Motors, the promoter of Tata Technologies, will sell 4.62 crore shares, valued at around ₹2,314 crores, through the Offer for Sale. Other investors, such as Alpha TC Holdings and Tata Capital Growth, will also sell portions of their shares.
Special Quota for Tata Motors’ Shareholders
Tata Technologies has reserved approximately 60.85 lakh shares for the shareholders of Tata Motors in this IPO. This quota allows them a preferential allocation of shares. Additionally, the company has reserved 20.28 lakh shares for its employees and offered 21st November as the anchor investor day.
Lot Size for Tata Technologies IPO
The bidding for Tata Technologies’ IPO will be done in lots, with each lot comprising 30 shares. The minimum bid quantity is 1 lot, meaning investors need to bid for at least 30 shares. The maximum bid price for one share is ₹500, and hence, the minimum bid amount for one lot is ₹15,000.
Financial Position of the Company
Tata Technologies has demonstrated robust financial performance. In the fiscal year 2023, the company’s net profit increased by 42.8% to ₹624 crores, and its revenue grew by 25% to ₹4,414.2 crores. Notably, in the first six months of this financial year, the net profit rose by 36%, reaching ₹351.9 crores, while revenue increased by 34% to ₹2,526.7 crores.
Associated Risks with the IPO
Despite the promising aspects of Tata Technologies’ IPO, it’s essential to be aware of associated risks, including its heavy reliance on Tata Motors and Jaguar Land Rover for 40% of its revenue. The company is also exposed to risks in the automobile segment.
IPO Listing Date
Tata Technologies’ IPO is expected to be listed on both BSE and NSE on December 5th. Investors will be closely watching for the market’s response to this IPO.
