Shares of Tata Investment Corporation Ltd surged 10.33 per cent in Tuesday's to hit a high of Rs 6,343.80. Today's sharp rise in the share price came after Tata Capital approved a plan to go public. Tata Capital's board has approved its plan to launch an initial public offering (IPO). The non-banking financial company (NBFC) would reportedly issue 23 crore new shares in the fresh process.
Tata Sons has a 92.8 per cent stake in Tata Capital. And, Tata Sons has around 68 per cent stake in Tata Investment. The company is also a non-bank firm registered with the Reserve Bank of India (RBI) under the 'Investment Company' category.
Tata Capital is required to list on the stock exchanges by September this year, as per the RBI's regulations for "upper layer" non-banking financial companies. It would be the first company from the Tata Group to launch an IPO since Tata Technologies went public in November 2023.
"Tata Investment, which has stakes in different financial entities of Tatas, tend to be in focus whenever there is a listing news of a group's firm. At present, the listing of Tata Capital is creating the buzz. Investors can consider booking some profit off the table," said Kranthi Bathini, Director of Equity Strategy at WealthMills Securities.
Technically, Tata Investment shares traded higher than the 5-day, 10-, 20-, 30-day and 50-day simple moving averages (SMAs) but lower than the 100-, 150-day and 200-day SMAs. The stock's 14-day relative strength index (RSI) came at 57.43. A level below 30 is defined as oversold while a value above 70 is considered overbought.
"Support on the counter will be at Rs 5,750 and resistance will be at Rs 6,500. A decisive move above Rs 6,500 level may trigger a further upside towards Rs 6,750. The expected trading range will be between Rs 5,500 and Rs 6,750 for the short term," said Jigar S Patel, Senior Manager - Technical Research Analyst at Anand Rathi.
As per BSE, the company's stock has a price-to-equity (P/E) ratio of 102.95 against a price-to-book (P/B) value of 0.80. Earnings per share (EPS) stood at 55.85 with a return on equity (RoE) of 0.78.