Asia Press Agency

Tag: initial public offering

  • Tata Technologies Raises ₹791 Crore from Anchor Investors

    Tata Technologies Raises ₹791 Crore from Anchor Investors

    Tata Technologies, the engineering services company under the Tata Group, has successfully raised ₹791 crore from 67 investors through an anchor book, just a day before its highly anticipated Initial Public Offering (IPO) opens for bidding. This marks a significant development as it hits the upper limit of the ₹475-500 price range set by the company for the IPO.

     

    In a filing to exchanges, Tata Technologies stated, “the company in consultation with the book running lead managers has finalised allocation of 1,58,21,071 equity shares to anchor investors, at a price of ₹500 per share.” The IPO, scheduled to open on November 22, will remain open for bidding until November 24.

     

    This IPO is particularly noteworthy as it represents the first public offering from a Tata Group company in almost two decades. The company aims to raise ₹3,042.51 crore through this IPO, which is entirely an offer for sale (OFS) in nature. Tata Technologies has reserved 20.28 lakh equity shares for its employees and 60.85 lakh shares for Tata Motors shareholders. The net issue of the IPO, excluding the portions allocated to employees and shareholders, constitutes the overall offering.

     

    Qualified institutional buyers (QIBs) have been allocated 50% of the total offer size, with 15% earmarked for high net worth individuals (HNIs). The remaining 35% is set aside for retail investors, providing a diverse participation opportunity in the IPO.

     

    Market analysts are closely watching the IPO, noting that Tata Technologies shares are trading at a substantial 70% premium in the grey market, which serves as an informal platform for trading IPO shares until their official listing. Despite volatile trends in the market, the grey market premium (GMP) for Tata Technologies IPO remains steady at ₹351, reflecting sustained investor interest.

     

    The IPO allotment date for Tata Technologies is expected on November 27, 2023, while the listing date is anticipated to be on November 29, 2023.

     

    Arihant Capital has given an ‘apply’ recommendation for the public offer. They highlight Tata Technologies’ diverse services, including IT consultancy, SAP implementation, and CAD/CAM engineering and design consultancy. The revenue breakdown shows a robust mix, with approximately 80% from services, 11% from products, and 9% from education.

     

    Strong partnerships with industry leaders like Dassault and Siemens, coupled with the use of Microsoft AZURE products, position Tata Technologies for global expansion. Recent empanelment by Airbus signals significant growth potential for the company. The revenue and profit after tax (PAT) of Tata Technologies have demonstrated a compound annual growth rate (CAGR) of 36% and 62%, respectively, from FY21 to FY23. In the first half of FY24, there was a 34% and 36% year-on-year growth in revenue and PAT.

     

    Arihant Capital suggests that Tata Technologies has outpaced competitors such as Tata Elxsi, L&T Technologies, and KPIT Technologies in revenue CAGR over the last three years. At an upper band valuation of ₹500, the issue is valued at a price-to-earnings (PE) ratio of 32.5x based on FY23 earnings per share (EPS). The recommendation encourages investors to subscribe to the IPO for potential short-term listing gains as well as long-term investment prospects.

  • Hero FinCorp Shortlists Investment Banks for ₹4,000 Crore IPO

    Hero FinCorp Shortlists Investment Banks for ₹4,000 Crore IPO

    Hero FinCorp, the financial services subsidiary of Hero MotoCorp, India’s prominent two-wheeler manufacturer, has taken a significant step toward launching a mega initial public offering (IPO) in 2024. The targeted size of this IPO is approximately ₹4,000 crore, according to reports from Moneycontrol, although it may fluctuate depending on market conditions and investor share sale strategies.

     

    This large-scale listing has garnered the support of eight distinguished investment banks, who will serve as advisors in this endeavor. The selected banks include JM Financial, Bofa Securities, Jefferies, ICICI Securities, HSBC Securities, UBS, SBI Capital, and HDFC, as confirmed by official sources.

     

    The proposed IPO will involve a combination of primary and secondary share issuance. This approach will not only raise essential growth capital but also provide an exit strategy for some investors, aligning with Hero FinCorp’s strategic financial goals.

     

    Hero FinCorp stands as one of India’s rapidly expanding non-banking financial companies (NBFCs) and has earned recognition for disbursing loans at a rate of one every 30 seconds. In terms of ownership, Hero MotoCorp holds approximately 40% of Hero FinCorp, while the Munjal family, who are the promoters, owns around 35-39% of the company. The remaining shares are in the hands of private equity investors such as Credit Suisse, Apollo Global, and a selection of Hero MotoCorp dealers.

     

    In terms of stock performance, shares of Hero MotoCorp demonstrated resilience on Tuesday, closing 0.37% higher at ₹3,171.80 on the BSE. Over the last year, the stock has surged by 25%, while it has exhibited a 16% increase in the current year, 2023.

     

    This stock’s performance over the past year has seen positive returns for seven out of ten months in the current calendar year. The three months with negative returns include August (-9%), March (-3%), and February (-12.5%). In contrast, the stock achieved a 10% increase in July, representing its highest monthly surge. As of October, the stock has already gained 4%, following a nearly 5% increase in September.

     

    The upcoming Hero FinCorp IPO is set to be a significant event in India’s financial sector, attracting the expertise of eight leading investment banks. As the company advances its IPO plans, its continued growth and strong market performance are expected to drive investor interest.

     

    Hero MotoCorp, one of India’s leading two-wheeler manufacturers, and its financial services arm, Hero FinCorp, are poised for a significant IPO in 2024, with the targeted size set at around ₹4,000 crore. A total of eight renowned investment banks have been selected to serve as advisors in this process. While the offering will combine both primary and secondary share issuance, the final size of the IPO may vary based on market conditions and investor strategies.

     

    The selected investment banks for this substantial listing include JM Financial, Bofa Securities, Jefferies, ICICI Securities, HSBC Securities, UBS, SBI Capital, and HDFC. This IPO aims to generate growth capital and offer an exit opportunity for certain investors, supporting Hero FinCorp’s financial objectives.

     

    In terms of stock performance, Hero MotoCorp’s shares exhibited resilience as they closed 0.37% higher at ₹3,171.80 on the Bombay Stock Exchange (BSE) on Tuesday. Over the past year, the stock has shown remarkable growth, posting a 25% increase, and it has already surged by 16% in 2023.

     

    The performance of Hero MotoCorp’s stock throughout the year has been characterized by positive returns in seven out of ten months in the current calendar year. The remaining three months recorded negative returns, particularly in August (-9%), March (-3%), and February (-12.5%). Conversely, the stock achieved a substantial 10% increase in July, representing its highest monthly gain. As of October, the stock has already risen by 4%, following an impressive 5% gain in September.

  • Samhi Hotels and Motisons Jewellers Get SEBI’s Nod for IPO

    Samhi Hotels and Motisons Jewellers Get SEBI’s Nod for IPO

    Capital markets regulator SEBI (Securities and Exchange Board of India) has given the green light to two companies, Samhi Hotels and Motisons Jewellers, to raise funds through initial public offerings (IPOs). SEBI’s approval implies that the companies can proceed with their plans to go public.

     

    Samhi Hotels, a hospitality company, has proposed an IPO comprising a fresh issue of equity shares valued at ₹1,000 crore and an Offer for Sale (OFS) of 90 lakh equity shares by existing shareholders. The OFS includes the sale of 42.36 lakh equity shares by Blue Chandra Pte Ltd, up to 24.78 lakh equity shares by Goldman Sachs Investments Holdings (Asia) Ltd, up to 15.47 lakh equity shares by GTI Capital Alpha Pvt Ltd, and up to 7.39 lakh equity shares by the International Finance Corporation. This OFS represents a partial exit by existing shareholders to comply with listing regulations.

     

    The proceeds from the fresh issue, amounting to ₹750 crore, will be utilized by Samhi Hotels for debt repayment and general corporate purposes. As of February 28, 2023, the company owns a portfolio of 3,839 key rooms across 25 operating hotels in 12 major urban consumer hubs in India, including Bengaluru, Hyderabad, the National Capital Region (NCR), Pune, Chennai, and Ahmedabad. Samhi Hotels is the largest owner of Fairfield by Marriott and Holiday Inn Express brands in India and operates under long-term management contracts with global hotel operators such as Marriott, Hyatt, and IHG.

     

    On the other hand, Jaipur-based jewelry retail company Motisons Jewellers plans to issue 3.34 crore fresh equity shares in its IPO, with no Offer for Sale component. The net proceeds from the IPO will be utilized for repaying existing borrowings from scheduled commercial banks, funding working capital requirements, and general corporate purposes.

     

    While Samhi Hotels had previously filed IPO papers with SEBI in September 2019 and obtained regulatory approval in November 2019, the IPO was not launched at the time. Motisons Jewellers had initially filed preliminary IPO papers with SEBI in September 2022, but the regulator returned the draft papers in December.

     

    Both companies intend to list their shares on the NSE (National Stock Exchange) and BSE (Bombay Stock Exchange) after completing their respective IPOs, joining the ranks of publicly-traded entities in the Indian capital markets.

  • Aeroflex Industries Receives SEBI Approval for ₹350 Crore IPO

    Aeroflex Industries Receives SEBI Approval for ₹350 Crore IPO

    Aeroflex Industries Ltd, a Mumbai-based company and a subsidiary of Sat Industries, has secured approval from the Securities and Exchange Board of India (SEBI) to proceed with its initial public offering (IPO). The company had filed its Draft Red Herring Prospectus (DRHP) with SEBI in April to raise approximately ₹350 crores through the IPO.

     

    The IPO comprises a fresh issue of equity shares worth up to ₹160 crores and an offer-for-sale (OFS) of up to 1.75 crore equity shares by the promoters, selling shareholders, and promoter group. Each equity share will have a face value of ₹2.

     

    “We have been informed by Aeroflex Industries Limited, our subsidiary, that it has received clearance from the Securities and Exchange Board of India (SEBI) for its initial public offer (IPO) subject to submission of requisite documents as per the final observation letter dated 31st July 2023,” stated Sat Industries in an exchange filing. The company may offer a discount to eligible shareholders of Sat Industries Ltd, its promoter and a listed entity on the stock exchanges, in consultation with the book-running lead manager (BRLM).

     

    The IPO proceeds will be utilized for debt repayment, meeting working capital requirements, and setting aside funds for general corporate purposes and potential acquisitions for inorganic growth, as per the DRHP.

     

    Pantomath Capital Advisors Private Ltd is the sole book-running lead manager for the IPO, while Link Intime India Private Ltd will act as the registrar. Following the IPO, Aeroflex Industries’ shares will be listed on both the BSE and NSE.

     

    The IPO will follow the book-building process, with at least 15% of the offer reserved for non-institutional investors and a minimum of 35% for retail individual investors. Qualified institutional buyers may be allocated up to 50% of the offer, while the shareholders of Sat Industries Ltd may receive up to 10% of the offer.

     

    According to the DRHP, the company’s consolidated revenue from operations in fiscal year 2022 amounted to ₹240.8 crore, with earnings before interest, taxes, depreciation, and amortization (EBITDA) reaching ₹46.7 crore and an EBITDA margin of 19.4%. The company’s profit after tax (PAT) for the same fiscal year was ₹27.5 crore, with a PAT margin of 11.4%. The IPO is expected to support the company’s growth plans and enhance its financial position for future expansion and development.