Tata Technologies’ Phenomenal Debut: Soars 140% in Blockbuster IPO Listing

Tata Technologies, the subsidiary of Tata Motors, made a stellar market debut on Thursday, soaring to a 140% premium over its issue price of ₹500. The stock opened at ₹1,200 on the NSE and ₹1199.95 on the BSE, marking the best listing since November 2021 for an IPO size exceeding ₹500 crore. The ₹3,042.51 crore IPO, the first from the Tata Group in almost two decades, attracted bids worth over ₹1.5 lakh crore, with an overall subscription nearly 70 times the shares on offer.

Analysts attribute Tata Tech’s impressive debut to robust subscription numbers, strong parentage, and growth potential in the engineering services industry. The IPO, a 100% offer for sale, received an overwhelming response, led by qualified institutional buyers subscribing 203.41 times their allotted quota. Retail investors and non-institutional investors subscribed 16 times and 62.11 times, respectively.

Market experts recommend investors to book 50% profits above ₹140, with optimism about Tata Technologies’ future prospects in the outsourcing and engineering services sector.

Tata Technologies, a pure-play manufacturing-focused engineering research and development (ER&D) company, boasts a robust growth trajectory. Its revenue and profit after tax demonstrated a Compound Annual Growth Rate (CAGR) of 36% and 62%, respectively, from FY21 to FY23. With a post-issue market cap estimated between ₹19,269 crore and ₹20,283 crore, Tata Technologies emerges as a key player in the engineering services landscape.

Investors who missed out on the IPO are advised to consider accumulating Tata Technologies on post-listing dips for long-term gains. The company’s impressive market debut signals strong demand, with analysts expecting the trade volume to remain robust, potentially reaching the ₹1,000 mark or higher.

Tata Technologies’ listing not only marks a positive development for the company but also signifies a significant milestone for the engineering services sector. Investors are encouraged to hold onto their shares for the long term, as the company positions itself for sustained growth in the evolving market landscape.