Tata Technologies IPO Opens Nov. 22: What Are Analysts Saying

The year’s most anticipated IPO is almost here. The first Tata IPO is two decades, Tata Technologies will open for bidding on Wednesday. The ₹3,043 crore IPO has investors and analysts buzzing. So, should you subscribe to the IPO, or give it a pass? Here’s what top analysts are saying.

Domestic brokerage firm Ventura issued a “subscribe” rating for the Tata Technologies IPO. The brokerage said that the gradual recovery in the global economy, coupled with increasing manufacturing capital expenditures and a shift in manufacturing from the US, Europe, and China to India, has positioned the Tata Group for strong financial performance in the coming years.

HDFC Securities in its note said that Tata Technologies Limited has deep automotive domain expertise and an in-depth understanding of client needs to help them optimize various stages of the product lifecycle, from conception and development to manufacturing, sales, and service. The company has established long-term partnerships with anchor clients, including Jaguar Land Rover (JLR) since 2010, providing opportunities to enhance skills and refine its value proposition in the automotive sector.

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Talking about the company’s clients, HDFC Securities highlighted that as of September 30, 2023, the company collaborates with major manufacturing enterprises worldwide, serving over 35 traditional automotive original equipment manufacturers (OEMs) and tier 1 suppliers, along with more than 12 new energy vehicle companies. Key clients include Tata Motors, JLR, Airbus, McLaren, Honda, Ford, Cooper Standard, VinFast, and others.

However, the brokerage also added that the company’s reliance on its Top five clients and the automotive sector is a concern.

The company has been looking to expand to other sectors. In their note, analysts at Ashika Research pointed out that Tata Tech is actively securing projects with leading engineering research and development (ER&D) spenders in the automotive, aerospace, transportation, construction, and heavy machinery (TCHM) verticals.

The brokerage also highlighted that its recent empanelment by Airbus is expected to provide a robust avenue for growth, further strengthening its position and expanding its footprint in the aerospace sector.

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