Tata Technologies IPO Update: Day 2 Subscription and GMP Details

Tata Technologies’ initial public offering (IPO) has garnered tremendous interest, surpassing expectations on its first day. The IPO, available for subscription from November 22 to November 24, has marked a significant milestone as the first IPO from the Tata Group in almost twenty years, drawing attention from investors.

Tata Technologies, a subsidiary of Tata Motors, specializes in providing Engineering Research & Development (ER&D) services, primarily focusing on the automotive industry.

This IPO, comprising an offer for sale (OFS) with an issue size of Rs 3,042.51 crore, involves the sale of 6.09 crore equity shares by the promoter and investors. The price range for the IPO is set at Rs 475 to Rs 500 per share.

The promoter, Tata Motors, plans to sell 4.62 crore equity shares valued at Rs 2,313.75 crore, while investors Alpha TC Holdings Pte Ltd and Tata Capital Growth Fund I will sell 97.17 lakh and 48.58 lakh shares, respectively.

Views on Tata Tech IPO

Market analysts are optimistic about Tata Technologies’ future, citing improving financials, a strong brand reputation, and reasonable valuations. Motilal Oswal Financial Services recommends subscribing to the IPO, emphasizing the company’s niche market presence, robust parentage, and strategic collaborations. The IPO’s pricing at 29x 1HFY24 P/E is seen as favorable, offering a discount compared to similar industry peers.

Arihant Capital Markets highlights Tata Technologies’ diverse service portfolio and suggests subscription for potential short-term gains as well as long-term investment opportunities.

Meanwhile, Geojit Financial Services assigns a “Subscribe” rating for the medium to long term, considering the company’s strong brand, extensive automotive expertise, and global footprint.

Current Subscription Status and GMP Update

As of the second day, the Tata Technologies IPO has been oversubscribed by 10.76 times as of 1:23 pm, with bids received for over 48 crore equity shares against the 4.50 crore shares on offer.

The retail category has witnessed a subscription of 9.02 times, while the Qualified Institutional Investors’ (QIB) category has been subscribed 4.15 times, and the Non-Institutional Investors’ (NII) category has been oversubscribed by 22.05 times.

The grey market premium (GMP) for Tata Technologies IPO stands at Rs 385 per share, reflecting a 77% premium over the issue price. This indicates robust market confidence, with shares reportedly trading at Rs 885 apiece in the grey market.

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