Tata Technologies Takes the Stage, Landmark IPO Marks Tata Group's Return to Public Markets After Two Decades
Tata Technologies' Strategic IPO Offers Investors a Global Engineering Revolution
16 November 2023
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Kunal Tyagi
Tata Technologies' IPO, priced at Rs 475-500 per share, is a historic event for the Tata Group, marking its first IPO in nearly two decades since Tata Consultancy Services in 2004.
The IPO is exclusively an Offer For Sale (OFS) of 6.08 crore equity shares by Tata Motors, Alpha TC Holdings, and Tata Capital Growth Fund I, expecting to fetch between Rs 2,890.4 crore and Rs 3,042.5 crore without any fresh equity issuance.
Tata Technologies, with over 20 years of global engineering expertise, plans to expand its market presence by deepening client engagements, targeting top R&D spenders, and enhancing capabilities in digital engineering across diverse industries like automotive, aerospace, transportation, and construction heavy machinery.
The much-anticipated initial public offering (IPO) of Tata Technologies, priced between Rs 475-500 per equity share, is set to open for public subscription on November 22, concluding on November 24. Notably, this marks a significant milestone for the Tata Group as it is the conglomerate's first IPO in nearly two decades, with Tata Consultancy Services being the last to go public in 2004.
This IPO is unique as it is entirely an Offer For Sale (OFS), with Tata Motors, the promoter, along with investor shareholders Alpha TC Holdings Pte. Ltd and Tata Capital Growth Fund I, collectively offering 6.08 crore equity shares. The absence of fresh equity issuance means that the company won't directly receive any funds from the IPO, with the issue expected to fetch between Rs 2,890.4 crore and Rs 3,042.5 crore at the lower and upper ends of the price band.
A noteworthy aspect of the offering is the strategic reservation of shares, with 20.28 lakh shares earmarked for Tata Technologies' employees and an additional 60.85 lakh shares set aside for Tata Motors' shareholders. Investors looking to participate can bid for a minimum of 30 equity shares and in multiples thereof.
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Tata Technologies, a global engineering services company with over two decades of experience, specializes in providing product development and digital solutions to original equipment manufacturers and Tier 1 suppliers globally. As part of its growth strategy, the company's MD and CEO, Warren Harris, outlined plans to deepen engagements with existing clients, target top R&D spenders in key verticals and geographies, expand capabilities in digital engineering, and strengthen service delivery through capacity and capability building.
The company's expertise extends beyond the automotive industry, with a focus on adjacent sectors such as aerospace, transportation, and construction heavy machinery industries. This diversification positions Tata Technologies to leverage its deep domain knowledge and serve clients in multiple industries.
The post-issue market capitalization of Tata Technologies is estimated to range between Rs 19,269 crore and Rs 20,283 crore, according to Axis Capital. The strategic placement of shares for different investor categories, including qualified institutional investors, retail investors, and non-institutional investors, underscores the company's commitment to a well-rounded and inclusive IPO.
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