Tata Motors will earn a profit of around Rs 2,279 crore following the much-awaited IPO of Tata Technologies. As per a report by the Economic Times, Tata Motors is selling 4.63 crore shares in the IPO of its subsidiary. With an upper price band of Rs 500 per share, Tata Motors will get almost Rs 2,314 crore by selling its 4.63 crore shares in Tata Tech IPO.
Tata Motors acquired a stake in Tata Tech which was incorporated as Core Software Systems in August 1994 for just Rs 7.4 per share. With a total investment of Rs 34.24 crore for 4.63 crore shares, Tata Motors will now earn a profit of Rs Rs 2,279.50 crore for Tata Tech IPO.
Tata Motors sold 9.9% stake for Rs 1,1613 crore in a pre-IPO deal last month. After selling 4.63 crore shares, Tata Motors’ stake in Tata Tech will go down from 64.79% to 53.39%.
Tata Tech IPO is open for subscription till November 24 and it has been valued at Rs 20,283 crore at a PE of 32.5x. On the Tata Tech IPO, SBI Securities said "We believe Tata Technologies is well placed to encash on the growth opportunities in ER&D space and looking at the relatively cheaper valuations, we recommend investors to subscribe to the issue."
