Tata Technologies Ltd, a subsidiary of Tata Motors, has received approval from the Securities and Exchange Board of India (SEBI) for its initial public offering (IPO). This marks the first public issue from the Tata group in nearly 20 years, since Tata Consultancy Services (TCS) went public in July 2004.
Tata Technologies filed the draft papers for the IPO with SEBI in March, and now the regulatory authority has given its approval. JM Financial Ltd, BofA Securities, and Citigroup Global Markets India Pvt Ltd will act as the lead managers to the issue.
Currently, Tata Motors holds a 74.69 percent stake in Tata Technologies, while Alpha TC Holdings Pte owns 7.26 percent. Tata Capital Growth Fund I has a 3.63 percent stake in the company.
The IPO will be a complete offer for sale (OFS) of up to 95.71 million shares by existing promoters and shareholders. Approximately 50 percent of the offer will be reserved for qualified institutional buyers (QIBs), 35 percent for retail investors, and the remaining 15 percent for non-institutional investors.
While the size of the offer has not been disclosed, sources suggest it could be worth around Rs 4,000 crore. Shareholders, including Tata Motors, Alpha TC Holdings Pte, and Tata Capital Growth Fund I, will be offloading their stakes through the IPO.
Following the announcement, the share price of Tata Motors saw an initial surge, starting the day at ₹579.95, up around 1 percent or ₹5.
The Tata Technologies IPO marks a significant milestone for the Tata group, bringing a new public issue after two decades. It presents an opportunity for investors to participate in the growth and success of the company, and it reflects the confidence of the promoters in the future prospects of Tata Technologies.