On 29th of November, 2023, Tata Motors Limited’s shares escalated beyond the ₹700 threshold for the first time ever in Wednesday’s trading session. The automotive giant witnessed its stock surge over 2%, reaching an unprecedented peak of ₹714.40 during afternoon trades. This surge is notably in anticipation of the upcoming listing of its subsidiary, Tata Technologies Ltd, on stock exchanges.
Closing at ₹711.50 on the National Stock Exchange on 29th of November 2023, Tata Motors’ stock has showcased an impressive 62% return over the past year, and an astonishing 80% increase since the start of this year.
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Tata Technologies, marking the first initial public offering (IPO) from the Tata Group in nearly two decades, is poised for its stock market debut on Dalal Street this Thursday, November 30. The company’s stock has already generated significant buzz in the grey market, where it’s trading at a premium of ₹420, indicating a potential listing price of ₹920, far above the issue price of ₹500.
The grey market, an informal trading platform, often serves as a barometer for IPO performance, providing early indications of the listing price. Market analysts are predicting a strong debut for Tata Technologies, expecting over 75% gains, buoyed by strong subscription demand and attractive pricing strategies.
Experts like Prashanth Tapse, Senior VP of Research at Mehta Equities, foresee a potential doubling in Tata Technologies’ post-listing value. Tapse attributes this optimism to the Tata brand’s strong investor appeal and the company’s unique, profitable global business model, which is well-positioned to capitalize on the growing outsourcing market.
Prathamesh Masdekar, a research analyst at StoxBox, echoed similar sentiments, emphasizing the strong business model of Tata Technologies and its remarkable subscription rate, which exceeded 69 times the offer. This overwhelming response sets the stage for an expected 80% premium over its initial offering price at listing.
Now read: Tata Motors share price target 2024 to 2030
Furthermore, Tata Motors remains a focal point in the market, especially with upcoming November auto sales data. According to Nomura India, Tata Motors’ passenger vehicle sales are likely to register at 44,000 units, a slight 4% decline year-on-year.
Despite this modest dip, the Tata Nexon’s recent facelift has been well-received, leading it to secure the top spot in the SUV segment across all categories in September and October 2023, with expectations to maintain this lead in November.
The current market cap as of November 29, 2023, is Rs. 2.61Lakh Crore and a PE ratio of 14.98.
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