Tenneco Clean Air India Set to Launch Rs 3,600 Crore IPO Next Week

Tenneco Clean Air India, a manufacturer of clean air, powertrain, and suspension systems, is preparing to launch its IPO. The subscription window will be open from Wednesday, November 12, to Friday, November 14. Anchor investor allocation will be finalised on November 11.

The IPO is entirely an Offer-for-Sale (OFS), meaning existing promoter Tenneco Mauritius Holdings will sell shares, and the company will not receive any fresh capital. The total issue size has been revised upwards to Rs 3,600 crore from the initially planned Rs 3,000 crore. The price band for the IPO is set at Rs 378-397 per share, with a face value of Rs 10. Retail investors can apply for a minimum of 37 shares.

Allocation is structured with up to 50% for Qualified Institutional Buyers (QIBs), at least 15% for Non-Institutional Investors (NIIs), and at least 35% for Retail Investors.

The company operates 12 manufacturing plants in India and serves both domestic and global original equipment manufacturers (OEMs).

Key Dates: Anchor Investor Allocation: November 11 Subscription Opens: November 12 Subscription Closes: November 14 Basis of Allotment: November 17 Refunds/Demat Credit: November 18 Expected Listing Date: November 19 on BSE and NSE.

Leading merchant bankers such as JM Financial, Citigroup Global Markets India, Axis Capital, and HSBC Securities and Capital Markets (India) are managing the issue, with MUFG Intime India as the registrar.

Impact: This IPO introduces a new entity in the Indian public market, particularly in the auto-component sector. An OFS-heavy issue might suggest a promoter's intent to divest rather than raise capital for expansion, which investors should note. The successful listing could influence investor sentiment towards other auto-component stocks. Rating: 6/10

Terms Explained: IPO (Initial Public Offering): The process by which a private company offers its shares to the public for the first time, becoming a publicly-traded company. OFS (Offer-for-Sale): A type of IPO where existing shareholders sell their shares to new investors, rather than the company issuing new shares to raise capital. Anchor Investors: Large institutional investors who commit to buying a significant portion of an IPO before it opens to the general public, providing stability and confidence. QIBs (Qualified Institutional Buyers): Large institutional investors like mutual funds, foreign institutional investors, and pension funds that are permitted to invest in the Indian stock market. NIIs (Non-Institutional Investors): Investors who are not institutional but invest large sums, typically high-net-worth individuals or corporate bodies. Retail Investors: Individual investors who apply for shares up to a specified limit (usually Rs 2 lakh). GMP (Grey Market Premium): An unofficial indicator of demand for an IPO before its official listing, reflecting the price at which shares are traded in the unofficial market.