Tata Motors is planning to list one of its subsidiaries, Tata Technologies, this fiscal. It will be after over 18 years, that India’s primary market will see listing of any Tata Group firm and also the first under the tenure of Tata Group chairman N Chandrasekaran who took over in January 2017. The salt-to-software conglomerate will use the proceeds to expand the business of Tata Technologies.
Tata Technologies plans to float an initial public offering on the back of a spate in demand in the electric vehicles segment and a rebound in the aerospace industry.
The Tata Motors subsidiary, a global product engineering and digital services company from the Tata group stable, has initiated the IPO process by getting onboard an investment bank to evaluate the float, according to a Moneycontrol report.
According to the automaker’s 2022 annual report, Tata Motors holds little more than 74 percent stake in Tata Technologies.
Tata Tech focuses on four key verticals – automotive, aerospace, industrial machinery and industrials. It has been growing rapidly on the back of the move to autonomous, connected, electrification and shared (ACES) mobility and accelerated investment in digital as manufacturing companies adapt to meet new and evolving customer needs.
Tata Technologies employs 9,300 people across the world, serving clients from facilities in North America, Europe, and the Asia Pacific region.
The company has 18 global delivery centres and four business segments: engineering, research, and development (ER&D) services, digital enterprise solutions (DES), education offerings, and value-added reselling and iProducts offerings.
For the year ended March 31, 2022, Tata Tech has delivered a revenue of Rs 3529.6 crore, together with an underlying operating profit of Rs 645.6 crore and a profit after tax of Rs 437.0 crore.
“These best ever results equate to a year-on-year revenue growth of 47 percent, operating profit growth of 65 percent, and profit after-tax growth of 74 percent,” said S Ramadorai, the chairman of the board of directors, in the firm’s latest annual report.
The company is empanelled by Airbus in its engineering, manufacturing engineering and services strategic supplier programme.
Tata Technologies has recently announced that it has joined the Foxconn-initiated MIH Consortium to promote development of sustainable mobility solutions and encourage collaboration within the industry.
The MIH (Mobility In Harmony Consortium) comprises more than 2,300 members in the field of software, hardware and services. The goal of this open electric vehicle alliance is to bring the strategic partners together to build the next generation of EV, autonomous driving and mobility service applications.
Tata Sky, another Tata Group company, is also planning to launch its IPO to provide an exit to investors, including Disney. The satellite television business has yet to file its draft red herring prospectus with the capital markets regulator, the Securities and Exchange Board of India.