During the first two hours of bidding on day one, Tata Technologies' initial public offering (IPO) saw high buying demand from all types of investors. The Tata Group's primary offering, which went on sale on Wednesday, November 22, was subscribed to 6.54 times on Day 1.
Tata Technologies is generating Rs 3,042.51 crore through its initial stake sale at a set price band of Rs 475-500 per share in lots of 30 equity shares and multiples thereof. The offering is fully an offer-for-sale (OFS) of up to 6,08,50,278 equity shares by the company's promoter and other selling shareholders.
According to the data, investors bid on 53,06,52,660 stock shares, or 11.78 times the number of equity shares offered for subscription by 2.15 p.m. on Thursday, November 23. Tomorrow, Friday, November 24, the three-day bidding period will come to an end.
The allocation for non-institutional investors (NIIs) was booked 23.58 times, while the allocation for Tata Motors shareholders was booked 146.45 times. The retail investor component was subscribed 9.45 times. The qualified institutional bidders (QIBs) quota was bid 6.22 times, while the employees' portion was booked twice at the same time.
The majority of brokerage firms watching the issue are bullish on it and have encouraged subscribing to it. They perceive the issue's primary advantages as excellent management and promoter backgrounds, a sturdy balance sheet, reasonable valuations, and solid growth potential in new areas.
"We recommend subscribing to the IPO given the long-term opportunities in the Er&d segments of automotive, aerospace, size and scale to participate in the same and scope to improve margins & cash flow going ahead," Incred Equities stated in a press release. The automobile sector opportunity is still a significant growth driver. According to the report, cash conversion could be more stable.
Tata Technologies collected Rs 791 crore from 67 investors via the anchor book, allocating 1,58,21,071 equity shares at Rs 500 each. The IPO's book running lead managers are JM Financial, Citigroup Global Markets India, and BofA Securities India, while the registrar is Link Intime India.
According to Phillip Capital, Tata Tech's IPO would have a PE of 25/21 times FY25/26, which is lower than the median PE for Indian ER&D service providers, which is 41x/35x. "We believe Tata Tech will benefit from strong momentum in auto and aerospace ER&D spending in the near to medium term." "We recommend that you subscribe to the IPO," it said.
