Tata Technologies Ltd has submitted a draft red herring prospectus to the Securities and Exchange Board of India for an initial public offering (IPO) to raise funds.
The offering will consist of a pure offer for sale of up to 95.71 million shares by the company’s current promoters and shareholders, including Tata Motors, Alpha TC Holdings Pte, and Tata Capital Growth Fund I.
Tata Motors currently holds a 74.69 percent stake in Tata Technologies, while Alpha TC Holdings Pte and Tata Capital Growth Fund I have stakes of 7.26 percent and 3.63 percent, respectively. The issue is being managed by JM Financial Ltd, BofA Securities, and Citigroup Global Markets India Pvt Ltd.
Tata Technologies is a company that specializes in digital services and product engineering, catering to various industries, such as automotive, industrial heavy machinery, and aerospace. With 33 years of experience, the company has gained considerable expertise in the field.
Tata Technologies Ltd has submitted a draft red herring prospectus to the Securities and Exchange Board of India for an initial public offering (IPO) to raise funds. The IPO comprises a pure offer for sale of up to 95.71 million shares by existing shareholders, including Tata Motors, Alpha TC Holdings Pte, and Tata Capital Growth Fund I.
Tata Technologies products and services
Tata Technologies offers a range of products and services in engineering, research and development, digital enterprise solutions, education programs, value-added reselling, and IT product lifecycle management services for connected businesses.
Its primary customers are Tata Motors and Jaguar Land Rover, but the company has recently increased business generated outside of the Tata Group. For the nine months ended December 2022, Tata Technologies reported a revenue of Rs 3011.79 crore and net profit of Rs 407.47 crore.
The company’s service segment revenue contributed 88.43 percent for the nine-month period and 85.88 percent for FY22 of the total revenue. If the IPO outperforms the proposed IPO of Tata Play, it could be the first time in over 18 years that the Tata group has gone public. Cyient, Johnson Controls, Infosys, KPIT Technologies, and Persistent are some of its competitors in the market.
Tata Technologies’ IPO could also increase the visibility of the Tata brand in the market, especially in the field of product engineering and digital services.
Additionally, the success of the IPO could signal a positive sentiment among investors towards the Tata Group and its businesses. However, if the IPO underperforms or faces any regulatory hurdles, it could have a negative impact on the Tata Group’s reputation and financials.