Tata Technologies sets IPO price band at Rs 475-500 per equity share

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Tata Technologies, an arm of Tata Motors, has set the price band for its Rs 3,000-crore initial public offering (IPO) at Rs 475-500 per equity share.


The anchor book will open on November 21, the issue will open for public subscription on November 22, and the case will close on November 24.


This IPO, the first from the Tata group in nearly two decades, is a pure offer-for-sale (OFS) of 60.85 million shares.


Tata Consultancy Services was the group’s last IPO in 2004.


Tata Technologies has reserved a 10 per cent quota for eligible shareholders of Tata Motors.


JM Financial Ltd, Citigroup Global Markets India Pvt. Ltd., and BofA Securities India Ltd. are the book-running lead managers for the issue.


Warren Harris, Managing Director and Chief Executive Officer at Tata Technologies, said the company has a healthy cash position and is debt-free.


“In terms of revenues, we delivered $547 million last year. In the first six months of this year, we have delivered $306 million in revenue. Last year, our operating margins were 18.6 per cent. We are debt-free and have a very healthy cash position,” Harris said.


Tata Tech offers product development and digital solutions to original equipment manufacturers. It works in the automotive domain and serves clients in aerospace, transportation, and construction heavy machinery (TCHM).


The company is looking to expand its presence outside the automotive domain.


“Today, automotive represents almost 90 per cent of our services mix. We have been investing in aerospace and TCHM for more than a decade. Eighteen months ago, we were accredited by Airbus. We have been rolling out the IT infrastructure that is expected of a regulated company like Airbus,” Harris added.


Tata Tech had cut its IPO size by more than a third. When the company filed its draft Red Herring Prospectus (RHP) with market regulator Securities and Exchange Board of India (SEBI) in March, it had intended to sell 95.71 million shares or 23.6 per cent equity.


In October, however, Tata Motors sold a 9.99 per cent stake in Tata Tech for Rs 1,613.7 crore to investors led by private equity major TPG. This valued the company at about Rs 16,137 crore.