SEBI Clears Tata Technologies IPO, Tata Group's First Public Issue In 20 Years

This is the first public issue from Tata Group in nearly 20 years. Tata Motors holds a 74.69 per cent stake in Tata Technologies, while Alpha TC Holdings Pte holds 7.26 per cent

Tata Technologies IPO will be purely an offer for sale, with Tata Technologies selling approximately 23.60 per cent of its paid-up share capital, equivalent to 9.57 crore equity shares.

Source : Tata Technologies Ltd

The Securities and Exchange Board of India (SEBI) has approved Tata Technologies Ltd's initial public offering (IPO) proposal. This is the first public issue from the Tata Group in nearly 20 years. Tata Technologies is a subsidiary of Tata Motors. The company had filed draft papers with SEBI earlier this year in March. The IPO will be purely an offer for sale (OFS), with Tata Technologies selling approximately 23.60 per cent of its paid-up share capital, equivalent to 9.57 crore equity shares.

In the OFS, Tata Motors will sell a 20 per cent stake in Tata Technologies by offloading 8.11 crore shares. Additionally, Alpha TC Holdings Pte plans to sell up to 97.16 lakh shares (2.40 per cent), and Tata Capital Growth Fund I will offload up to 48.58 lakh equity shares (1.20 per cent).

Currently, Tata Motors holds a 74.69 per cent stake in Tata Technologies, while Alpha TC Holdings Pte holds 7.26 per cent, and Tata Capital Growth Fund I has a 3.63 per cent shareholding.

The book-running lead managers to the IPO are JM Financial Ltd, Citigroup Global Markets India, and BofA Securities India.

Tata Technologies is an engineering services company that provides product development and turnkey solutions to global original equipment manufacturers (OEMs) and their tier-1 suppliers. Some of the company's listed competitors include KPIT Technologies, L&T Technology Services, and Tata Elxsi.

In terms of financial performance, Tata Technologies reported revenue from operations of Rs 3,011.79 crore for the nine months ended December 2022, compared to Rs 2,607.30 crore for the corresponding period in 2021.

Other IPO Approvals

The market regulator SEBI also approved SBFC Finance Ltd and Gandhar Oil Refinery Ltd's IPOs.

SBFC Finance refiled its' draft documents with SEBI in March, announcing a reduction in the size of its initial public offering (IPO) from Rs 1,600 crore to Rs 1,200 crore. The IPO consists of a fresh issue of Rs 750 crore and an offer for sale (OFS) of Rs 450 crore.

ICICI Securities Limited, Axis Capital Limited, and Kotak Mahindra Capital Company Limited have been appointed as the book-running lead managers for the IPO.

Gandhar Oil Refinery Ltd also filed IPO papers in December 2022. The IPO includes a fresh issue of Rs 357 crore and an OFS of up to 1.2 crore shares by promoters and shareholders.

The funds raised through the fresh issue will be utilised by Gandhar Oil Refinery for debt repayment and the purchase of equipment and civil work necessary to expand the automotive oil capacity at the Silvassa plant, as stated by the company.

Gandhar Oil Refinery is a manufacturer of white oils, with a growing focus on the consumer and healthcare industries. Edelweiss Financial Services and ICICI Securities are acting as the merchant bankers for the IPO.

White mineral oil, a highly refined colorless and odorless mineral oil, is extensively used in pharmaceuticals, cosmetics, and various other sectors.

(Disclaimer: This report is meant only for information purposes. It should not be treated as a stock recommendation. Reader discretion advised.)