Tenneco Clean Air Secures Rs 1,080 Crore Ahead of IPO Launch

Tenneco Clean Air India Ltd. has successfully raised Rs 1,080 crore from a diverse group of anchor investors, just a day before its initial public offering (IPO) is set to open for subscription. This significant investment reflects strong interest from both domestic and international funds, underscoring the company’s potential in the automotive components sector.

According to a circular published on the BSE website, the anchor book attracted participation from 41 global and domestic funds. Notable investors include SBI Mutual Fund, ICICI Prudential Mutual Fund, HDFC Mutual Fund, and Kotak Mahindra Mutual Fund. Other key participants consist of Nomura Funds Ireland Public Limited Company, BlackRock Global Funds, Goldman Sachs Funds, and Motilal Oswal Mutual Fund.

The company allocated 2.72 crore equity shares to these anchor investors at a price of Rs 397 per share. Of the total shares, 1.47 crore, or 54.15% of the anchor book, went to 17 domestic mutual funds through various schemes.

IPO Details and Allocation Strategy

Tenneco Clean Air India’s IPO, valued at Rs 3,900 crore, is scheduled to open on November 12, 2023, and will close on November 14, 2023. The price band for the shares ranges from Rs 378 to Rs 397 per share, making it an attractive option for investors. The share allotment status is expected to be finalized by November 17, 2023.

The offering’s structure indicates that qualified institutional buyers will be able to acquire up to 50% of the net offer, while retail investors are assured at least 35%. The remaining 15% of the allocation is reserved for non-institutional investors. Notably, Tenneco Clean Air will not benefit from the proceeds of this IPO, as it is entirely an offer-for-sale issue.

Company Background and Market Position

Tenneco Clean Air India operates as a vital subsidiary of the US-based Tenneco Group, a prominent Tier I automotive component supplier. The parent company reported a revenue of $16,777 million for the fiscal year ending December 31, 2024. Established in 1979, Tenneco Clean Air India began its operations with its first manufacturing facility located in Parwanoo, Himachal Pradesh. The company focuses on providing advanced, technology-driven solutions in clean air, powertrain, and suspension systems.

As the IPO approaches, the strong backing from anchor investors signals confidence in Tenneco Clean Air’s future prospects and ability to contribute to the evolving automotive landscape in India. With a well-defined allocation strategy and significant investor interest, the upcoming IPO represents a key milestone for the company and its stakeholders.