Tata Group Plans IPO For Electric Vehicle Unit, Eyes $1-2 Billion Listing: Report

The IPO, anticipated to occur within the next 12–18 months, aligns with Tata Group's broader strategy to capitalise on its investments rather than solely focusing on fundraising

In a move aimed at monetising its investments in the electric vehicle (EV) sector, Tata Group is gearing up to list its subsidiary, Tata Passenger Electric Mobility Ltd (TPEM), in an initial public offering (IPO) valued at $1-2 billion. According to a report by BusinessLine, this move underscores the conglomerate's commitment to capitalizing on the burgeoning EV market.

TPEM, a key player in India's EV industry and a subsidiary of Tata Motors, is renowned for its popular EV models, Nexon.ev and Tiago.ev. With Tata Motors commanding over 80 per cent of the electric car market share, TPEM stands as the nation's largest EV manufacturer.

The IPO, anticipated to occur within the next 12–18 months, aligns with Tata Group's broader strategy to capitalise on its investments rather than solely focusing on fundraising. Sources familiar with the matter told BusinessLine that the IPO aims to unlock the value of Tata Group's investments in the EV segment.

Notably, TPEM secured a significant $1 billion funding round from US private equity major TPG in January 2023, as part of its ambitious plans to infuse $2 billion by 2026. Reports suggest that TPEM's current valuations range between $9.5–10 billion.

Amidst the growing traction in EV sales, Tata Motors, through TPEM, has witnessed robust performance, selling over 53,000 electric cars in FY24. Projections indicate sales of approximately 100,000 EVs in FY25. In January alone, Tata Motors recorded a remarkable 69 per cent year-on-year (YoY) growth in EV sales, totalling 6,979 units, including exports.

Looking ahead, Tata Motors aims to expand its EV portfolio, with plans to introduce 10 electric cars over the next three to four years. Moreover, the company recently announced price reductions for its popular EV models, Nexon and Tiago, following similar moves by competitors like MG Comet. The revised prices, effective immediately, offer savings of up to Rs 1.2 lakh for Nexon.ev and up to Rs 70,000 for Tiago.ev, making Tata's EV offerings even more attractive to consumers.

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