Tata Technologies IPO: Tata Technologies IPO
Now only a few days are left for opening. With this, after about 20 years, a new company of Tata Group will enter the stock market. Tata Group is considered a symbol of trust. For many decades, this group has been continuously giving good returns to investors through its various companies. This is the reason investors are showing enthusiasm about the IPO of Tata Technologies. We have explained the entire IPO of Tata Tech in very simple points in this article, so that it becomes easier for you to take the decision related to investment in it.
1. IPO date
Tata Tech’s IPO will open on 22nd November and you will get a chance to invest in it till 24th November. Now coming to the price band.
2. Price Band and Valuation
The price of one share of Tata Tech will be in the range of Rs 475 to Rs 500. In most successful IPOs, shares are allotted at the upper price only, so you can assume it to be Rs 500 per share. At this price, the valuation of the entire company comes to Rs 20,283 crore.
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3. Size of IPO
The entire IPO of Tata Tech is worth around Rs 3,042.51 crore. This IPO is completely offer-for-sale (OFS). What happens in an offer-for-sale is that the company does not issue any new shares. Rather, its existing shareholders put their shares up for sale. It is obvious that when shareholders sell shares, they will keep the money received from it there. The company gets money from IPO only when it sells new shares. But Tata Tech is not selling any new shares in this IPO.
4. Tata Motors will get ₹2,314 crore from IPO
In the offer-for-sale, Tata Tech promoter Tata Motors will sell 4.62 crore shares, the value of which is about Rs 2,314 crore. That means Tata Motors will get Rs 2,314 crore from this IPO. Apart from this, some investors of the company like Alpha TC Holding will sell shares worth Rs 486 crore. Whereas Tata Capital Growth will sell shares worth about Rs 243 crore.
5. Special quota for Tata Motors shareholders
Here is another important news for the shareholders of Tata Motors. Tata Tech has reserved about 60.85 lakh shares for Tata Motors shareholders in its IPO. This means that if you have shares of Tata Motors, then you can apply for IPO in this quota also. Apart from this, the company has reserved 20.28 lakh shares for its employees. Whereas for anchor investors this IPO will be opened a day earlier on 21st November.
6. Lot size of Tata Tech IPO
You must know about IPO that bidding is done according to lots. One lot of Tata Tech will have 30 shares. That means you will have to bid for at least 30 shares. The maximum price of one share is Rs 500. That means you will have to invest at least Rs 15,000 to bid for one lot.
7. Financial health of the company
Tata Tech’s financial performance is quite good. Its profit increased by 42.8 percent to Rs 624 crore in financial year 2023. Its revenue has increased by 25% to Rs 4,414.2 crore. For the first half of this financial year, i.e. till September, the company’s profit increased by 36% to Rs 351.9 crore, while its revenue increased by 34% to Rs 2,526.7 crore.
8. Risks associated with IPO
However, despite so many good things, there are some risks regarding Tata Tech’s IPO, which is important for you to know.
– The first risk is that 40% of Tata Tech’s earnings come from two companies of its own group, Tata Motors and Jaguar Land Rover. The disadvantage of having most of the revenue coming from one place is that if these companies face any difficulties, the performance of Tata Tech will also deteriorate.
The second risk is that most of its revenue currently comes only from companies in the automobile segment. This company has not yet been able to diversify its revenue in other segments.
– The third risk is that the company’s cash flow was negative in the past and its cash flow may become negative in the future, which may have an adverse impact on liquidity and business.
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9. IPO listing
Finally coming to the listing date of the company. Tata Technology’s IPO will be listed on BSE and NSE on 5th December. It remains to be seen how enthusiastically investors will accept this IPO.
