Tenneco Clean Air IPO Day 3 LIVE: Issue booked 62x. GMP hints 20% listing pop. Should you subscribe or not?

The issue, which witnessed a muted response on the opening day, gained momentum on the second and third days, with the overall issue receiving bids for 392 crore shares against the 6.34 crore shares on offer, resulting in a subscription rate of 61.79 times.

Qualified institutional buyers showed strong interest, with their portion subscribed 174.78 times, as they placed bids for 316 crore shares compared with the allotted 1.81 crore shares. The non-institutional buyers segment reflected similar enthusiasm, with its portion booked 42 times.

The retail quota, however, showed weak interest as their portion was booked at 5.37 times, as per the exchange data.

Tenneco Clean Air IPO was booked 58.83 times as of the third day of the bidding process today. The QIB segment was booked the most at 166.42 times, followed by the NII portion at 40.74 times and the retail part at 5.11 times.

The company is a leading supplier of highly engineered and technology-intensive clean air, powertrain, and suspension solutions to major Indian and global OEMs. It holds dominant positions across several sub-segments—being the largest supplier of Clean Air Solutions to Indian Commercial Truck OEMs (57% share) and Off-Highway OEMs excluding tractors (68% share), and the largest supplier of shock absorbers and struts to Indian Passenger Vehicle OEMs (52% share) in Fiscal 2025.

For Q1 FY26, Tenneco India reported a revenue of INR 128.56 cr, reflecting steady growth. EBITDA reached INR 22.89 cr with a margin of 17.8%. Profit After Tax (PAT) was INR 16.81 cr, showing an improvement from the previous year. The company continues to be net debt-free, with solid capital efficiency, boasting a Return on Capital Employed (ROCE) of 56.78% in FY25. These results highlight robust profitability and healthy financials.

Tenneco Mauritius Holdings Ltd, Tenneco (Mauritius) Ltd, Federal-Mogul Investments BV, Federal-Mogul Pty Ltd, and Tenneco LLC are the promoters of the company.

Tenneco Clean Air IPO Day 3 LIVE:

1. Growth driven by R&D, emission compliance and long-standing client relationships
2. Strong position in the CV, OH and PV segments
3. Leading supplier of critical, highly engineered and technology-intensive clean air solutions
4. Manufacturing facilities are located strategically across India, ensuring supply chain efficiencies
5. Backed by global clean air tech leader Tenneco Group, Diversified OEM Portfolio
6. Consistent positive operating cash flows and profit growth over recent years

Tenneco Clean Air IPO Day 3 LIVE:

1. Capturing market opportunities driven by tightening emission standards.
2. Capitalizing on trends toward premiumization, SUVs, EVs and hybrids.
3. Enhancing competitiveness through strategic localization – “Make in India”.
4. Positioning operations in India as an export hub with global manufacturing standards.
5. Further leverage efficiencies and cross-selling across two divisions to drive overall growth profile.

1. The company derives ~80% of its revenue from PV and CV spaces, exposing the company to higher automobile related cyclical impact.
2. The company is heavily influenced by government policies and regulations regarding emission standards, which can adversely impact its business operations.
3. TCAIL relies on the Tenneco Group for brand licenses, patented technologies, technical knowhow, and certain key materials. Any adverse change or termination of this relationship could negatively impact its operations, financial performance, and market position.

Tenneco Clean Air IPO Day 3 LIVE: According to BP Equities, on the valuation front, with the company trading at a P/E of 29.0x based on it FY25 earnings, at considerable discount compared to other components peers.

"We thus recommend a "SUBSCRIBE" rating from a medium-to longterm perspective," said the brokerage.

Tenneco Clean Air IPO Day 3 LIVE: The company will not receive any proceeds from the issue as the entire offer comprises of OFS worth Rs. 3,600 crores

Tenneco Clean Air IPO Day 3 LIVE: The company also operates two R&D centres in India, equipped to address both global and local needs. In Q1FY26 and FY25, TCAIL served 101 and 119 customers, respectively, including all top seven PV OEMs in India and all top five CT OEMs in India (OEM rankings determined by sales volume in Fiscal 2025). TCAIL also boasts an average relationship of 19.2 years with its top 10 customers.

Tenneco Clean Air IPO Day 3 LIVE:

1. Established market leadership and a diverse portfolio strategically positions the company to capture market and industry trends.
2. Innovation-driven operations and an efficient, localized manufacturing network to drive competitive edge

Tenneco Clean Air IPO Day 3 LIVE: Lakshmishree Investment & Securities said that the initial public offering is structured as a pure Offer for Sale (OFS), with no fresh capital infusion to the company itself. Despite risks like the automotive industry's cyclical nature and the long-term threat from EV adoption to ICE components, Tenneco Clean Air India’s deep integration with top OEMs.

“We recommend a ‘SUBSCRIBE’ rating for investors seeking exposure to a premium, profitable leader in India's technology-driven auto component sector,” said the brokerage.

Tenneco Clean Air IPO Day 3 LIVE:

1. 61.26% of revenues were generated from OEMs of Passenger vehicles which is exposed to economic fluctuations and consumer demand.
2. Heavily influenced by government policies and regulations such as transitioning to Bharat Stage 6 (BS6) in 2020.

1. Emissions Mandate Tailwinds
2. Market Leadership
3. OEM Deep Integration
4. Global Tech Advantage
5. Dual Growth Drivers

Tenneco Clean Air IPO Day 3 LIVE: SBICAP Securities said that the company effectively leverages the parent’s 5,000 patents and 7,500 trademarks to design and develop products suited for Indian OEMs and is ready to leverage rising trend of premiumization in the Indian Auto industry.

“At upper price band of ₹397, the issue is valued at FY25 P/E and EV/EBITDA multiple of 29.0x and 19.3x respectively. We recommend investors to SUBSCRIBE to the issue,” said the brokerage.

Tenneco Clean Air IPO Day 3 LIVE: The company offer a diversified range of customized and proprietary products and solutions for each industry subsegment including exhaust aftertreatment systems such as catalytic converters, mufflers and exhaust pipes, engine bearings, sealing systems, spark plugs, shock absorbers and struts and advanced suspension systems.

1. Dependence on parent company: The company depends on entities in the Tenneco Group for the license to use Tenneco Group’s brands and patented designs, technical know-how, purchase of certain parts and materials, and R&D. Any adverse change in relationship, including the termination of License Agreement may have an adverse impact on the company’s performance.
2. Customer concentration: During FY23/FY24/FY25/1QFY26, the company derived 77.8%/83.9%/81.5%/80.6% of its revenue from its Top 10 customers.

Tenneco Clean Air IPO Day 3 LIVE: The company operates two distinct business divisions:

A) Clean Air & Powertrain Solutions: The division includes a) Clean Air Solutions, where the company designs, manufactures and sells exhaust aftertreatment systems, such as catalytic converters, mufflers and exhaust pipes to OEMs, and b) Power train Solutions, where it designs, manufactures and sells engine bearings, sealing systems and ignition products (such as spark plugs and ignition coils) to OEMs and the aftermarket under the ‘Champion’ brand.

B) Advanced Ride Technologies: The division designs, manufactures and sells shock absorbers, struts and advanced suspension systems under the Monroe brand to OEMs and the aftermarket which are used by both internal combustion engine and electric vehicles.

Tenneco Clean Air IPO Day 3 LIVE:

1. Capture market opportunities driven by tightening emission standards.
2. Capitalize on rising trends of premiumization, SUVs, Electric vehicles & Hybrid vehicles.
3. Enhance competitiveness through strategic localization and “Make in India”.
4. Positioning of operation in India as an export hub with global manufacturing standards.
5. Continued focus on R&D and product innovation.
6. Further leverage efficiencies and cross-selling across two divisions to drive overall growth.
7. Continued focus on operational efficiencies to ensure sustained improvement in profit and cash generation.

Tenneco Clean Air IPO Day 3 LIVE: As of Jun’25, Tenneco India operated 7 Clean Air & Powertrain facilities and 5 Advanced Ride Technology facilities across 7 states & 1 UT, which are strategically located near auto hubs. These facilities are equipped with advanced technologies and quality production processes and employ precision manufacturing techniques which provides flexibility for product development.

Tenneco Clean Air IPO Day 3 LIVE: The company has supplied to 101 customers during 1QFY26 and has built relationship with all the Top 7 PV and Top 5 CT OEMs in India incl. M&M, Tata Motors, Ashok Leyland, Maruti Suzuki, VECV, Daimler India CV, John Deere, Toyota Kirloskar Motor etc.

Tenneco Clean Air IPO Day 3 LIVE: The company offer a diversified range of customized and proprietary products and solutions for each industry subsegment including exhaust aftertreatment systems such as catalytic converters, mufflers and exhaust pipes, engine bearings, sealing systems, spark plugs, shock absorbers and struts and advanced suspension systems.

Its offerings also include aftermarket & export products which are generally counter-cyclical revenue streams which reduces impact of downturn in the Indian automotive industry.

Tenneco Clean Air IPO Day 3 LIVE: SBICAP Securities noted that the firm skillfully utilises the parent company’s 5,000 patents and 7,500 trademarks to create and develop products tailored for Indian OEMs and is poised to capitalise on the growing trend of premiumisation in the Indian automotive sector.

“At upper price band of ₹397, the issue is valued at FY25 P/E and EV/EBITDA multiple of 29.0x and 19.3x respectively. We recommend investors to SUBSCRIBE to the issue,” said the brokerage.

Tenneco Clean Air IPO Day 3 LIVE: As per ICICI Direct, supported by its robust leadership in clean-air and ride performance systems, along with enduring relationships with OEMs, Tenneco is well-equipped to take advantage of the current trends in India's automotive sector, with structural advantages promoting sustainable growth in the years ahead.

“We recommend Subscribe rating on Tenneco Clean Air India Ltd, given its robust business fundamentals, healthy 30%+ return ratios profile and reasonable valuations i.e. ~29x PE & ~19x EV/EBITDA on FY25 basis,” said the brokerage.

Tenneco Clean Air IPO Day 3 LIVE: Tenneco Clean Air IPO subscription status was 2.93 times on day 2. The retail portion was subscribed 1.44 times, and NII portion has been booked 7.18 times, Qualified Institutional Buyers (QIBs) portion received 2.34 times bids.

Tenneco Clean Air IPO Day 3 LIVE: The promoters of Tenneco Clean Air include Tenneco Mauritius Holdings Ltd, Tenneco (Mauritius) Ltd, Federal-Mogul Investments BV, Federal-Mogul Pty LTD, and Tenneco LLC.

Tenneco Clean Air IPO Day 3 LIVE: Tenneco Clean Air IPO raised ₹1,080 crore from anchor investors, just a day prior to the launch of its public offering. The anchor book attracted participation from 58 organizations, including SBI Mutual Fund, ICICI Prudential Mutual Fund, HDFC Mutual Fund, SBI Life Insurance, ICICI Prudential Life Insurance, Nomura Funds Ireland, Fidelity, BlackRock, Norway's Government Pension Fund Global, Abu Dhabi Investment Authority, and Goldman Sachs, as per a circular posted on the BSE's website.

Tenneco Clean Air IPO Day 3 LIVE: The company has stated that 50% of the issue size is allocated for qualified institutional buyers, 35% for retail investors, and the remaining 15% for non-institutional investors.

Tenneco Clean Air IPO Day 3 LIVE: Tenneco Clean Air IPO GMP today is ₹78. Considering the upper end of the IPO price band and the current premium in the grey market, the estimated listing price of Tenneco Clean Air India share price was indicated at ₹475 apiece, which is 19.65% higher than the IPO price of ₹397.

Based on the activities in the grey market over the past 12 sessions, today's IPO Grey Market Premium (GMP) is showing an upward trend and is anticipated to have a robust listing. The minimum GMP recorded is ₹0.00, while the maximum GMP is ₹101, as per the experts.

'Grey market premium' indicates investors' readiness to pay more than the issue price.

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 making any investment decisions.