Tata Technologies shares likely to list at 75% premium against IPO price: Why analysts expect a stellar debut tomorrow

Tata Technologies IPO: The Tata Group's much-awaited initial public offering (IPO) received an overwhelming response from investors during its three-day subscription period last week. Shares of Tata Technologies is all set to debut on stock exchanges BSE and NSE on Thursday, November 30. Since, the companies off late have been switching to T+3 norms the allotment and listing date are being preponed.

Market experts on D-Street expect a blockbuster listing tomorrow and project Tata Technologies shares to list at over 75 per cent premium against its issue price of ₹500 per equity share. Tata Technologies IPO was subscribed 69.43 times on its third and the last day of the bidding process.

Analysts bullish on Tata Technologies listing

“Considering overwhelming subscription demand and investor friendly pricing, Tata Technologies could see a strong listing gain of over 75 per cent against the issue price of ₹500 per share,'' said Prashanth Tapse, Research Analyst, Sr VP Research, Mehta Equities. There is a high possibility that Tata Technologies can be a doubler candidate post listing, according to Tapse.

Market observers also highlighted that Tata is known as investor friendly group and enjoys special preference amongst investors. The parent group sees a sense of trust among retail investors who subscribed to the issue.

Also Read: Tata Technologies IPO allotment finalised: GMP, subscription details, steps to check Tata Tech IPO allotment status

‘’We believe the super listing premium is justified mainly on the back of TATA parentage tag that enjoys first preference among investors community and its unique well established global business model which has been generating healthy margins in the sector it serves,'' said Mehta Equities' Tapse.

Analysts also bank on Tata Technologies'' strong track record of growth and profitability for a strong listing on the bourses. The company's global presence and expertise in engineering solutions have positioned it as a preferred partner for multinational corporations across diverse industries.

‘’Tata Technologies' diversified customer portfolio, robust delivery network, and emphasis on innovation further solidify its competitive advantage. With a P/E ratio of 18.2x, the Tata Technologies IPO is priced fairly, reflecting the company's strong fundamentals and promising growth prospects. Given the immense investor interest and the company's robust capabilities, Tata Technologies is poised for a successful listing on the Indian stock exchanges and it will be interesting to witness this listing,'' said Shivani Nyati, Head of Wealth, Swastika Investmart Ltd.

Tata Technologies IPO share allotment has been finalised today. Investors who applied for the issue can check Tata Technologies IPO allotment status in the registrar's portal, which is Link Intime India Private Ltd. The company will initiate the refund process for applicants not given shares. Those allotted will receive their shares in their demat accounts. Analysts suggest allotted investors to book profits on shares and retain a part of their holdings.

‘’Given the growth potential in outsourcing, the business model would be in great demand going forward. We recommend allotted investors to book 50 per cent profits over and above our expectations and retain the rest of the holding for long term considering healthy long term returns post listing. Investors who failed to get allotments in the public offer can accumulate Tata Technologies on every dips post listing for a long term,'' said Mehta Equities' Tapse.

Tata Technologies IPO Details

Tata Technologies plans to raise ₹3,042.51 crore from the IPO which is entirely an offer for sale (OFS) of 6.09 crore equity shares by the promoter and investors. The OFS comprises up to 60,850,278 shares including sale of up to 46,275,000 shares by promoter Tata Motors Ltd, up to 9,716,853 shares by investor Alpha TC Holdings and up to 4,858,425 Equity Shares by Tata Capital Growth Fund I.

Also Read: Tata Technologies IPO: Here's why Tata's first issue in 20 years has gripped the pulse on D-Street

Tata Technologies offers product development and digital solutions including turnkey solutions, to global original equipment manufacturers (OEMs) and their tier-1 suppliers. The company had fixed the price band for the IPO in the range of ₹475 to ₹500 per equity share of face value of ₹2. The three-day bidding process for the IPO ended on November 24.

Tata Technologies IPO GMP

Analysts said that the Tata Group's issue has received strong response from investors and this could be the possible reason for rise in grey market sentiments in regard to the book build issue.

Tata Technologies IPO GMP or grey market premium is ₹440 per share. This indicates that Tata Technologies IPO share price were trading at a premium of ₹440 on Wednesday, according to investorgain.com. 'Grey market premium' indicates investors' readiness to pay more than the issue price.

Considering the upper end of the IPO price band and the current premium in the grey market, the estimated listing price of Tata Technologies is ₹940 apiece, which is 88 per cent higher than the IPO price of ₹500.