TATA Technologies Mainboard IPO

Incorporated in 1994, TATA Technologies stands as a global leader in engineering services, pioneering transformative solutions in product lifecycle management, engineering, and IT services. Fueled by innovation and commitment, TATA Technologies plays a pivotal role in reshaping industries and advancing technological frontiers, setting new standards for excellence.

TATA Technology is all set to go live on 22nd November 2023. It is the first initial public offering by the TATA Group in nearly 2 decades.

TATA Technologies intends to raise Rs. 3042.51 Cr. through an Offer-for-sale (OFS) of 6.08 Cr. equity shares via its IPO route. Under an OFS issue, selling shareholders are entitled to the entire proceeds earned from the issue.

As per the plan, parent TATA Motors will offload 4.62 Cr. shares, Alpha TC Holding will sell 97.1 Lakh shares & TATA Capital growth fund will sell another 48 Lakh shares. The IPO size has been reduced from the earlier reported 9.57 crore equity shares to 6.08 crore equity shares.

TATA Technologies IPO Date/Timetable:

Open Date	Close Date	Lot Size	IPO Size	Issue Price	Minimum Investment	Lead Manager	Listing At
22nd November	24th November	30 Shares	Rs. 3042.51 Cr.	Rs. 475-500	Rs. 15,000	JM Financial Limited	BSE & NSE

TATA Technologies- IPO- Promoters & Management:

TATA Technologies has 7 Directors of which 3 are independent directors & 2 Non-executive directors. The company also has 2 Key Managerial Posts (KMP) held by Mr. Ajoyendra Mukherjee who currently holds the position of Chairman in the organization. The other KMP is held by Mr. Warren Harris who is appointed as the Managing Director & CEO of the organization.

TATA Technologies- IPO- Grey Market Premium (GMP)

TATA Technologies is expected to be listed at a 70% premium of Rs. 500 per share versus an issue of Rs. 350 per share.

TATA Technologies- IPO- Financial Performance (In Crores)

Financials	31 March 2021	31 March 2022	31 March 2023	31 September 2023
Assets	3,572.74	4,218.00	5,201.49	5,142.42
Revenue	2,425.74	3,578.38	4,501.93	2,587.42
Profit After Tax	239.17	436.99	624.04	351.09
Net Worth	2,142.15	2,280.16	2,989.47	2,853.15
Reserves & Surplus	1,897.46	2,028.93	2,605.60	2,455.29
Total Borrowing	1430.57	1,937.87	2,212.54	N/A

The company has been focusing on rapid expansion which is indicated by its increased spending on assets. The company assets as of 31st March 2023 stood at Rs. 5,142.42 Cr. in comparison to assets worth Rs. 3,572.74 Cr. reported on 31st March 2021.

The company revenue has doubled over the past 3 years & as of 31st March 2023 stood at Rs. 4,501.93 Cr. in comparison to Rs. 2,425.74 Cr. in 2021. Infact in the first 6 months of the ongoing FY24, the company is on its path to surpass the previous year’s figures.

Similarly, the company’s PAT has also seen substantial growth from Rs. 239.17 Cr. as of 31st March 2021 to Rs. 351.09 Cr. as of 31st March 2023

Company borrowing has also seen a steady hike from Rs. 1,430.57 Cr. in 2021 to Rs. 2,212.54 Cr. in 2023.

TATA Technologies- IPO- Comparison with Industry Peers

Categories	TATA Technologies	L&T Technology Services	KPIT Technologies
Market Cap.	39,437 Cr.	48,908 Cr.	31,976 Cr.
P/E	32.44	38.3	84.6
P/B	7.68	10.2	22.2
EV/EBITDA	30.01	26.5	59.7

TATA Technologies falls in the large market cap. category with around Rs. 40,000 Cr. market cap. which is lower than its closest peer L&T Technology which stands at Rs. 48,908 Cr. but higher than its second closest peer KPIT which stands at 31,976 Cr. Its P/E ratio (~ 32.44) is lower than its industry peers L&T (~ 38.30) & significantly lower than other peer KPIT (~ 84.60). The Industry P/E stands at 38.0 which shows that the company is overvalued. TATA Technology’s P/B stands at 7.68 which is considerably lower than L&T which stands at 10.2 & KPIT Technologies which had a P/B of 22.2 which again is shows that the stocks is undervalued & has higher potential. The EV/EBITDA of TATA Technology stood at 30.01 which was slightly higher than 26.5 at L&T but considerably lower than KPIT Technology which had an EV/EBITDA of 59.7. This is a reflection of the company being in a good position financially.

Conclusion:

In conclusion, the upcoming TATA Technologies IPO promises to be a watershed moment in the realm of technology and engineering. As the company gears up to go public, investors can anticipate a unique opportunity to partake in the growth story of a visionary leader in the field. With TATA Technologies' track record of innovation, global impact, and commitment to excellence, the IPO becomes a compelling prospect for those seeking to align with a forward-looking organization that continues to shape the future of technology and engineering solutions on a global scale.