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Business News/ Markets / Ipo/  Tata Technologies IPO: What share price in grey market signals about the issue?

Tata Technologies IPO: What share price in grey market signals about the issue?

Tata Technologies share price has touched ₹830 apiece in unlisted market, say experts

Tata Technologies Ltd valuations or market cap is expected around ₹18,000 crore to ₹20,000 crore,, believe experts. (Bloomberg)Premium
Tata Technologies Ltd valuations or market cap is expected around 18,000 crore to 20,000 crore,, believe experts. (Bloomberg)

Tata Technologies IPO: Ever since Tata Technologies — India's 15th largest It company filed DRHP (Draft Red Herring Prospectus) at market regulator Securities and Exchange Board of India (SEBI) for the launch of its initial public offering (IPO), market observers and Tata Motors shareholders are busy counting the benefit coming to the Indian auto major's balance sheet after this value unlocking.

As mentioned in Tata Technologies DRHP, Tata Motors has bought Tata Technologies shares paying 7.40 per share price and as per the market expectations, market capital of Tata Technologies is expected to be around 18,000 to 20,000 crore, which means one share of Tata Technologies would cost around 500 apiece, leading to around 6,650 per cent appreciation in Tata Motors investment in Tata Technologies Ltd. Meanwhile, grey market is also bullish on Tata Technologies IPO. According to market observers, Tata Technologies share price is trading around 830 per equity share.

Tata Technologies IPO valuations

Speaking on the expected valuations of Tata Technologies IPO, Anuj Gupta, Vice President — Research at IIFL Securities said, "Tata Technologies Ltd market cap is expected to be around 18,000 to 20,000 crore and the public issue is going to help balance sheet of the Tata Motors to a larger extent and it would be value unlocking by the auto major from its investment in the upcoming IPO."

Tata Technologies IPO price

On expected price on the basis of Tata Technologies IPO valuations, Abhay Doshi, founder at UnlistedArena.com, which deals in unlisted stocks, said, "The pricing of Tata Technologies (IPO) will ultimately be determined by the company. However, market analysts are using close peers as KPIT Tech and Tata Elxsi to estimate its potential valuation. Based on their current P/E at 68x and 55x respectively (TTM basis), it is estimated that Tata Technologies could be valued between 700 to 880 if we take into account their annualised FY23 EPS of around 13."

"However, Tata Group is widely known for its investor-friendly approach and hence, there is a possibility of IPO being priced reasonably keeping much value on table for investors," Abhay Doshi added.

Tata Technologies share price today in grey market

On response to Tata Technologies shares in unlisted market, Abhay Doshi said, "The bullishness of investors can be seen in the fact that the unlisted shares of Tata Technologies have already exceeded 830. Overall, while the ultimate pricing of the IPO remains to be seen, it is clear that there is significant interest in the company."

Tata Technologies IPO date and time

Asked about Tata Technologies IPO date and time of launch, Avinash Gorakshkar, Head of Research at Profitmart Securities said, "We can expect SEBI's nod to Tata Technologies IPO in current quarter and after that we can add none to two month more at maximum. This means by July end of this year, we can expect Tata Technologies IPO to hit primary market. However, there is no sure shot time frame for SEBI to give its nod to a DRHP."

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.

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Asit Manohar
Chief Content Producer at Live Mint Digital Team
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Published: 17 Apr 2023, 09:22 AM IST
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