Tata Technologies, the first IPO listing from Tata Group in nearly two decades, made a blockbuster debut on the stock exchanges on Thursday, beating street expectations. The shares of Tata Technologies made a debut at ₹1,200 apiece on the NSE, up 140% against the initial public offering (IPO) price of ₹500 per share. On the BSE, the Tata Group stock opened at ₹1,199.95 per share.
Post listing, Tata Technologies shares gained 180% over the IPO price to ₹1,400 apiece, while the market capitalisation surged to ₹56,555 crore.
Meanwhile, Tata Tech promoter entity, Tata Motors extended its gaining streak for the third day, with its shares hitting a fresh 52-week high in opening trade. The shares gained 0.7% to touch a new 52-week high of ₹717, while its m-cap rose to ₹2.35 lakh crore.
Ahead of the listing, Tata Tech's grey market premium (GMP) zoomed 95% over the IPO price to ₹475 in the unlisted market, implying a listing price of ₹975 per share. Analysts had broadly recommended “subscribe” to the issue, considering its deep expertise in the automotive industry, well-recognised brand with experienced promoters, as well as healthy financial performance.
Analysts remained bullish on the Tata Tech stock, saying that it's a great opportunity for investors to encash listing gains as well as for long-term benefits.
“The overwhelming response to the IPO was evident in its staggering oversubscription of 69.43 times. This robust investor interest reflects the company's strong fundamentals and promising growth prospects and of course the legacy of the Tata group,” says Shivani Nyati, Head of Wealth, Swastika Investmart.
“The listing of Tata Technologies is a positive development for the company and the engineering services sector. Investors who participated in the IPO should consider holding on to their shares for the long term, as the company is well-positioned for sustained growth,” she adds.
The ₹3,042.51 crore IPO of Tata Tech, third-biggest in terms of issue size in 2023, created a record of attracting the highest number of applications on its issue, surpassing the likes of LIC of India, Reliance Power, Glenmark Life Sciences, SBI Life Insurance, Zomato, Nykaa, among others. With 73.58 lakh applications on the final day of its issue, Tata Tech smashed the record of 73.38 lakh applications of LIC of India, the country’s biggest-ever IPO after Paytm, which came in May 2022.
The public issue of Tata Tech, a subsidiary of Tata Motors, was booked 69.43 times during the three-day bidding between November 22-24, with the portion reserved for qualified institutional buyers (QIBs) getting subscribed by record 203.41 times. The quota for non-institutional investors (NIIs) and retail investors was booked 62.11 times and 16.50 times, respectively, while reserved portions for shareholders and employees were subscribed 29.19 and 3.70 times, respectively.
Tata Tech had reserved 50% of the issue for QIBs, 15% for NIIs, and the remaining 35% for retail investors. Besides, the firm has set aside 20.28 lakh equity shares for its employees and 60.85 lakh for Tata Motors shareholders.
The minimum lot size for investment was 30 shares, which means minimum application amount for retail investors was ₹15,000 and maximum was ₹195,000 for 13 lots (390 shares).
Tata Technologies, a subsidiary of Tata Motors, has deep domain expertise in the automotive industry and leverages this expertise to serve clients in adjacent industries, such as aerospace and transportation and construction heavy machinery (TCHM). As of Sep '23, the company had a global workforce of 12,451 employees serving multiple global clients from 19 global delivery centers in Asia Pacific, Europe, and North America.
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