Tata Technologies documents IPO papers with Sebi

Tata Technologies documents IPO papers with Sebi

Tata has filed papers to market regulator Sebi to release the initial public offering (IPO) of Tata Technologies. There will not be any new shares issued as part of the IPO; instead, the promoter, Tata Motors, and two more current shareholders are presenting a pure offer for sale.

"We wish to inform you that Tata Technologies, a subsidiary of Tata Motors Limited, has informed the company that it has today filed a draft red herring prospectus dated March 9, 2023, with the Securities and Exchange Board of India for an initial public offering," Tata Motors said.

The IPO is by way of an offer for sale (OFS) of up to 95,708,984 equity shares, representing approximately 23.60% of its paid-up share capital.

As of now, Tata Motors holds 74.42% of Tata Technologies, Alpha TC Holdings Pte Ltd, a Singapore-based investment firm managed by Tata Capital Advisors, owns 8.96%, while Tata Capital Growth Fund owns another 4.48%.

The IPO comprises OFS of up to 81,133,706 equity shares by Tata Motors, 9,716,853 equity shares by Alpha TC Holdings and up to 4,858,425 shares by Tata Capital Growth Fund I, each representing up to 20%, 2.40% and 1.20%, respectively of Tata Technologies paid-up share capital.

Under the offer, which is being made through the book-building process, 35% of the IPO size would be reserved for retail investors. Tata Tech said it is not contemplating a pre-IPO placement of its shares.

In December, the Tata Motors board approved a partial divestment of its stake in Tata Tech through a public float.

The engineering unit of Tata Motors caters to automotive, aerospace, industrial heavy machinery and others. As a global product engineering and digital services company, it helps companies in the convergence of digital technology and traditional engineering to develop better products.

In the nine-month period ending December 2022, the company reported a revenue of Rs 3,011.8 crore, recording a growth of 15.5% on a year-on-year basis. The company's profit for the nine-month period came in at Rs 407.5 crore.

This is the second IPO filed by the diversified conglomerate since the listing of TCS in 2004. Earlier in December, satellite TV operator Tata Play had filed a 'pre-filed' DRHP or confidential IPO paper with Sebi, the first company to do so under the new regulations.