After an overwhelming response to the IPO, the shares of Tata Technologies are witnessing high demand in the unlisted market, with the grey market premium (GMP) reaching as high as Rs 412. This indicates the strong interest and positive sentiment surrounding the stock. The expected listing price is at a massive premium of Rs 82% over the IPO issue price. However, it is important to note that grey market premiums are volatile and subject to change rapidly.

The tentative allotment date for the IPO is November 28, with the listing likely to take place on November 30. The IPO received bids worth over Rs 1.5 lakh crore, indicating the strong investor interest in Tata Technologies.

The subscription levels for the IPO were impressive, with the quota reserved for retail individual investors (RIIs) being subscribed 16 times, qualified institutional buyers 203 times, and non-institutional investors 62 times. This strong response can be attributed to the attractive valuations of the company compared to its peers, as well as the strong brand value associated with the Tata lineage.

Analysts have highlighted the company’s attractive valuations compared to its peers, with Tata Technologies’ FY23 PE ratio at 32-33x, while its peers like KPIT, L&T Technology Services, and Tata Elxsi have higher PE ratios ranging from 40x to 105x. The company has also outpaced its peers in terms of financial growth over the period of FY21-23.

Tata Technologies is a pure-play manufacturing-focused engineering research and development (ER&D) company, primarily focused on the automotive industry. It has a significant presence in the automotive ER&D space, being engaged with 7 out of the top 10 automotive ER&D spenders and 5 out of the 10 prominent new energy ER&D spenders in 2022. The company generates the majority of its revenue from services (80%), followed by products (11%) and education (9%) as of FY23.

Some of the key strengths of Tata Technologies include its differentiated capabilities in new-age automotive trends like electric vehicles, its deep expertise in the automotive industry, and its global delivery model that enables intimate client engagement and scalability.

The strong demand and positive response to Tata Technologies’ IPO indicate investor confidence in the company’s prospects and its ability to deliver strong financial performance in the future.