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Amid huge interest from investors across the board, Tata Technologies IPO was heavily subscribed within hours of opening. The enthusiasm for Tata Technologies IPO is huge as it is the Tata Group’s first IPO in almost two decades.
Tata Technologies is a subsidiary of auto major Tata Motors and is a pure-play manufacturing focused Engineering Research & Development (ER&D) company, primarily focused on the automotive industry.
Let’s check Tata Technologies IPO subscription status, GMP today and other key details.
Tata Technologies IPO Subscription Status
Tata Technologies IPO has been subscribed 18.77 times so far on Friday, the third and the last day of the bidding process. The public issue received bids for 84.50 crore equity shares against 4.50 crore shares on the offer, according to data available on NSE at 11:10 am
The issue has been subscribed 12.88 times in the retail category and 13.68 times in the Qualified Institutional Buyers (QIB) category, while the Non-Institutional Investors (NII) portion has been booked 39.92 times so far.
Tata Technologies IPO created a record of attracting the highest number of applications on its issue among private sector companies. With over 59 lakh applications so far, Tata Technologies IPO has outbid major private companies like Zomato, Reliance Power, FSN E-Commerce Ventures (Nykaa), and others.
Read here: Tata Technologies IPO sets record! Attracts more than 50 lakh subject applications, highest among private companies
Tata Technologies IPO GMP today
Tata Technologies IPO GMP today, or gray market premium today, increased to ₹405 per share, which is 81% higher than the issue price, market observers said.
This indicates that Tata Technologies stock is trading at a premium of 81% at ₹905 each in the gray market compared to the issue price of ₹500 per share.
Considering the GMP today and the issue price, Tata Technologies shares are estimated to be listed at ₹905 each in the stock exchanges.
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Should you subscribe to Tata Technologies IPO?
Most analysts have advised to subscribe to the Tata Technologies IPO on the back of the company’s improving financials, strong brand heritage and reasonable valuations.
During FY20-23, the company’s sales grew by 15.7% and reached ₹4,414 crore in FY23. EBit margins also improved from 13% in FY20 to 16.5% in FY23.
“The company plans to strengthen relationships with existing customers, target new high potential accounts with large annual ER&D expenditures and new energy vehicle companies, to drive growth. ROE and ROCE also improved and stood at 20.9% and 24.3% respectively for FY23. With this, at the given upper price band of edition of ₹500, Tata Technologies is offered at an annualized H1FY24 PE of 28.8x, which we think is attractive. We recommend subscribing to the issue,” said brokerage firm Nirmal Bang.
Read also: Tata Technologies IPO Day 2: Check latest GMP, subscription status, other details. Do you have to apply?
SBI Securities believes that Tata Technologies is well placed to cash in on the growth opportunities in ER&D space and looking at the relatively cheaper valuations, it recommends investors to subscribe to the issue.
“At the upper price band of ₹500, Tata Technologies trades at 32.5x FY23 P/E multiple. Its peers trade at a relatively expensive valuation with a FY23 P/E multiple of 108.9x for KPIT, 68.5x for Tata Elxsi and 40.1x for LTTS,” SBI Securities noted.
Tata Technologies IPO Details
The Tata Technologies IPO opened for subscription on November 22 and will close today on November 24. The IPO allocation is expected to be completed on Thursday, November 30.
The shares of Tata Technologies will list on BSE, NSE with a tentative listing set on December 5.
Read also: Flair Writing IPO: Offer ends today. Check the latest GMP, subscription status, apply or not?
Tata Technologies IPO issue size is ₹3,042.51 crore which is an outright offer for sale (OFS) of 6.09 crore equity shares from the promoter and investors. The IPO price band was set at ₹475 to ₹500 per share.
Promoter Tata Motors will offload 4.62 crore equity shares ₹2,313.75 crore in the OFS, while investors Alpha TC Holdings Pte Ltd will sell 97.17 lakh shares and Tata Capital Growth Fund I will offload 48.58 lakh shares in the Tata Technologies IPO.
JM Financial, Citigroup Global Markets India and BofA Securities India are the book-running lead managers of the Tata Technologies IPO, while Link Intime India Private Ltd is the IPO registrar.
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Disclaimer: The opinions and recommendations made above are those of individual analysts or trading companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
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Updated: 24 Nov 2023, 11:17 IST