Impact of Tata Technologies IPO: Tata Motors share price is up 25% in two months. Experts see more potential
Tata Technologies IPO DRHP (Draft Red Herring Prospectus) was filed on March 9, 2023 to sell up to 9,571 crore of Tata Technologies shares. Tata Technologies Ltd’s initial public offering (IPO) is an offer to sell by its existing shareholders, including Tata Motors, Alpha TC Holdings Pte and Tata Capital Growth Fund-I.
Tata Technologies IPO DRHP (Draft Red Herring Prospectus) was filed on March 9, 2023 to sell up to 9,571 crore of Tata Technologies shares. Tata Technologies Ltd’s initial public offering (IPO) is an offer to sell by its existing shareholders, including Tata Motors, Alpha TC Holdings Pte and Tata Capital Growth Fund-I.
Tata Motors currently owns 74.69 percent of the company, while Alpha TC Holdings Pte and Tata Capital Growth Fund-I own 7.26 percent and 3.63 percent of the shares, respectively. After the Tata Group subsidiary filed DRHP with SEBI, Tata Motors shares have been on an uptrend, and over the past two months, Tata Motors’ share price has risen by about 25 percent as Rekha Jhunjhunwala’s portfolio stock rose by about ₹410 to ₹510 levels a piece in that time.
Tata Motors currently owns 74.69 percent of the company, while Alpha TC Holdings Pte and Tata Capital Growth Fund-I own 7.26 percent and 3.63 percent of the shares, respectively. After the Tata Group subsidiary filed DRHP with SEBI, Tata Motors shares have been on an uptrend, and over the past two months, Tata Motors’ share price has risen by about 25 percent as Rekha Jhunjhunwala’s portfolio stock rose by about ₹410 to ₹510 levels a piece in that time.
According to stock market experts, Tata Technologies’ IPO is fully OFS in nature, meaning the net proceeds from the public offering will go directly into the body of the companies selling off their shares in the company. As Tata Motors divests its stake in the company, the market expects Tata Motors’ financial position to improve and better earnings from the automaker to be expected in the coming quarters. As such, the uptrend in Tata Motors shares is expected to continue and as such, any decline in the stock should be viewed as a buying opportunity by positional investors.
According to stock market experts, Tata Technologies’ IPO is fully OFS in nature, meaning the net proceeds from the public offering will go directly into the body of the companies selling off their shares in the company. As Tata Motors divests its stake in the company, the market expects Tata Motors’ financial position to improve and better earnings from the automaker to be expected in the coming quarters. As such, the uptrend in Tata Motors shares is expected to continue and as such, any decline in the stock should be viewed as a buying opportunity by positional investors.
Why should you buy Tata Motors stock?
Avinash Gorakshkar, Head of Research at Profitmart Securities, explained the reasons for the uptrend in Tata Motors shares: “Tata Motors Ltd would be a direct beneficiary of Tata Technologies’ IPO as the automotive group sells the stake in Tata Technologies it has acquired sold.” ₹7.40 each (as mentioned in the DRHP). Since the Tata Technologies IPO is fully OFS in nature, the net proceeds from the public offering would benefit Tata Motors and not Tata Technologies. As such, the IPO is expected to strengthen the balance sheet of Tata Motors, not Tata Technologies. As such, the market is expecting Tata Motors’ financial position to improve and better quarterly results in the coming quarters.”
Why should you buy Tata Motors stock?
Avinash Gorakshkar, Head of Research at Profitmart Securities, explained the reasons for the uptrend in Tata Motors shares: “Tata Motors Ltd would be a direct beneficiary of Tata Technologies’ IPO as the automotive group sells the stake in Tata Technologies it has acquired sold.” ₹7.40 each (as mentioned in the DRHP). Since the Tata Technologies IPO is fully OFS in nature, the net proceeds from the public offering would benefit Tata Motors and not Tata Technologies. As such, the IPO is expected to strengthen the balance sheet of Tata Motors, not Tata Technologies. As such, the market is expecting Tata Motors’ financial position to improve and better quarterly results in the coming quarters.”
The Profitmart Securities expert said that those interested in applying for Tata Technologies IPO have a chance to multiply their return from the public offering by buying Tata Motors shares. He said that any decline in Tata Motors’ stock price by the opening date of Tata Technologies’ IPO would be a good buy-on-the-dip opportunity for a positional investor.
The Profitmart Securities expert said that those interested in applying for Tata Technologies IPO have a chance to multiply their return from the public offering by buying Tata Motors shares. He said that any decline in Tata Motors’ stock price by the opening date of Tata Technologies’ IPO would be a good buy-on-the-dip opportunity for a positional investor.
Price target for Tata Motors shares
Commenting on the outlook for Tata Motors shares, Mudit Goel, senior technical analyst at SMC Global Securities said: “Tata Motors share price looks strong on the chart and the stock could rise ₹525 a piece in the near future. Therefore, those who own this portfolio stock of Rekha Jhunjhunwala are advised to remain invested in the stock ₹525 target where trailing stop loss is maintained ₹495 levels each. Once the stock stays up ₹525, it could go up to 525 soon ₹545 levels per piece. So those Tata Motors shareholders who want to keep the stock ₹With a target of 545 per piece, they are advised to increase their trailing stop loss to ₹505 once the stock closes above ₹525 levels.”
Price target for Tata Motors shares
Commenting on the outlook for Tata Motors shares, Mudit Goel, senior technical analyst at SMC Global Securities said: “Tata Motors share price looks strong on the chart and the stock could rise ₹525 a piece in the near future. Therefore, those who own this portfolio stock of Rekha Jhunjhunwala are advised to remain invested in the stock ₹525 target where trailing stop loss is maintained ₹495 levels each. Once the stock stays up ₹525, it could go up to 525 soon ₹545 levels per piece. So those Tata Motors shareholders who want to keep the stock ₹With a target of 545 per piece, they are advised to increase their trailing stop loss to ₹505 once the stock closes above ₹525 levels.”
According to Tata Motors shareholding structure for the quarter January to March 2023, Rekha Jhunjhunwala holds 5,22,56,000 Tata Motors shares, representing 1.57 percent of the company’s total paid-up capital.
According to Tata Motors shareholding structure for the quarter January to March 2023, Rekha Jhunjhunwala holds 5,22,56,000 Tata Motors shares, representing 1.57 percent of the company’s total paid-up capital.
Tata Technologies IPO details
Tata Technologies has registered DRHP with the SEBI for its IPO on March 9, 2023. The Company plans to sell up to 9,571 crore shares, representing approximately 23.6 percent of its paid up share capital, through an offering. The IPO is an offer to sell by its existing shareholders, including Tata Motors, Alpha TC Holdings Pte and Tata Capital Growth Fund-I. Tata Motors currently owns a 74.69 percent stake in the company, while Alpha TC Holdings Pte and Tata Capital Growth Fund-I own 7.26 percent and 3.63 percent of the shares, respectively.
Tata Technologies IPO details
Tata Technologies has registered DRHP with the SEBI for its IPO on March 9, 2023. The Company plans to sell up to 9,571 crore shares, representing approximately 23.6 percent of its paid up share capital, through an offering. The IPO is an offer to sell by its existing shareholders, including Tata Motors, Alpha TC Holdings Pte and Tata Capital Growth Fund-I. Tata Motors currently owns a 74.69 percent stake in the company, while Alpha TC Holdings Pte and Tata Capital Growth Fund-I own 7.26 percent and 3.63 percent of the shares, respectively.
Disclaimer: The views and recommendations expressed above are provided by individual analysts or brokerage firms and not by Mint. We recommend investors to consult certified experts before making an investment decision.
Disclaimer: The views and recommendations expressed above are provided by individual analysts or brokerage firms and not by Mint. We recommend investors to consult certified experts before making an investment decision.
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