Tata Group eyeing $1-2 bn IPO of electric vehicle arm in 12-18 mths: Report

The Tata Group is eyeing to list its electric vehicle (EV) unit Tata Passenger Electric Mobility Ltd (TPEM) as it aims to monetise its investments in the EV business, reported BusinessLine.

As per the report, the Tata group is aiming for a $1-2 billion initial public offering (IPO) of the EV unit and the listing could happen in the next 12–18 months, that is in FY25 or latest by FY26 "if business climate for EVs remains robust and the overall market sentiments is positive". 

TPEM, a subsidiary of passenger vehicle giant Tata Motors, is India's largest electric vehicles (EV) manufacturer and maker of the best selling EV models Nexon.ev and Tiago.ev, and holds 

 

Tata Motors is the market leader in the electric car market with more than 80 per cent market share. (via TPEM)

While the IPO may help the EV maker in its fundraising plans, its listing has more to do with the Tata group’s overall strategy on investment monetisation, the report said, citing sources. 

“Listing of TPEML is to ensure that the Tata Group is able to monetise its investments in the electric vehicles business rather than to garner funds from the market,” a banker told BusinessLine. 

TPEM closed $1 billion round of funding from US private equity major TPG in January 2023. The fundraise was part of the company’s plans to infuse $2 billion by 2026.

According to reports, TPEM’s valuations are pegged at $9.5–10 billion. 

Tata Motors, via TPEML, has sold over 53,000 electric cars so far in FY24 and expects to sell about 100,000 EVs in FY25, as per reports.

In January, Tata Motors’ EV sales grew by 69 per cent year-on-year to 6,979 units (including exports).

Tata Motors, which began EV-only dealerships in September, plans to have 10 electric cars in its portfolio over the next three to four years. 

Tata Motors recently was the latest after MG Comet to slash prices of its two popular EV models-Nexon and Tiago-by up to Rs 1.2 lakh.

The Nexon.ev would now start from Rs 14.49 lakh and the Tiago.ev would start from Rs 7.9 lakh. For the Nexon.ev, the price reduction is up to Rs 1.2 lakh and for the Tiago.ev, the price cut is up to Rs 70,000. Read