Highlights
| Issue Size – 90,680,101 shares | Issue Open/Close – 12 Nov / 14 Nov, 2025 |
| Price Band (Rs.) 378 – 397 | Issue Size (Rs.) ~ 36,000 mn |
| Face Value (Rs) 10 | Lot Size (shares) 37 |
Tenneco Clean Air India Ltd. (TCAIL) incorporated in 2018, engaged in manufacture and supply of critical, highly engineered and technology intensive clean air, powertrain and suspension solutions tailored for Indian original equipment manufacturers (OEMs) and export markets.
TCAIL has a diversified product portfolio spanning exhaust aftertreatment systems such as (i) catalytic converters (ii) mufflers and exhaust pipes (iii) engine bearings (iv) sealing systems (v) spark plugs (vi) shock absorbers and struts and advanced suspension system.
As of FY25, Company operates 12 manufacturing facilities, comprising 7 Clean Air & Powertrain Solutions facilities and 5 Advanced Ride Technologies facilities, across seven states and 1 union territory in India. These facilities are strategically positioned near its customers in key automotive OEM hubs such as Maharashtra, Tamil Nadu, NCR and Gujarat, minimizing delivery time.
Company will not receive any proceeds out of Rs. 36,000 mn offer and all the offer proceeds will be received by the selling shareholders after deduction of offer related expenses and relevant taxes thereon, to be borne by the selling shareholders.
Key Highlights
- Indian auto component production (including sales to OEMs, exports and replacement market) has increased at a 13.4 pct CAGR to Rs. 8,622 bn in FY25 from Rs. 4,592 bn in FY20. Auto component exports grew at a strong 13.4 pct CAGR during FY20 to FY25. The auto component market size is expected to grow between FY25 and FY30 to reach Rs. 13,500 to Rs. 14,500 bn.
- TCAIL caters to all vehicle segments namely PV, CV, 2W, and off-highway with strong long lasting OEM partnerships with marquee clients including Maruti Suzuki, Tata Motors, Mahindra, Hyundai, and Ashok Leyland. It supplies to both domestic and export markets.
- TCAIL holds a leading position across core product segments, supported by strong OEM integration and long-standing engineering partnerships. It commands about 57 pct share in clean-air systems for CVs, 68 pct in off-highway equipment, and 52 pct in PV shock absorbers and struts, establishing it as one of India’s most entrenched Tier-1 suppliers.
- TCAIL derive advantages from Tenneco Group’s global presence and brand strength, as well as its global standards of governance and operations, which bolster their operations and market position in India. They leverage Tenneco Group’s global R&D initiatives to enhance innovation capabilities and product offerings. They also capitalize on Tenneco Group’s vendor relationships to optimize raw material procurement processes and costs.
- The company’s strategy focuses on (i) Capturing market opportunities driven by tightening emission standards (ii) Capitalizing on trends toward premiumization, SUVs, EVs and hybrids (iii) Enhancing competitiveness through strategic localization – Make in India. (iv) Positioning their operations in India as an export hub with global manufacturing standards (v) Continued focus on R&D and innovation (vi) Further leverage efficiencies and cross-selling across two divisions to drive overall growth profile (vii) Continued focus on operational efficiencies to ensure sustained improvement in profit and cash generation
- Sales of the company has grown by 0.7 pct CAGR in over FY23-25 and EBITDA and Profit grew by 19.5 pct CAGR and 20.5 pct CAGR over same period. During FY25 the sales of the company fell by 10.6 pct YoY to Rs. 48,904 mn. While EBITDA of the company grew by 33.2 pct YoY to Rs. 8152 mn and EBITDA margin expanded by 5.48 pct to 16.7 pct YoY in FY25. During FY25, the company reported profit of Rs. 5531 mn, which grew 32.7 pct YoY.
Key Risk
- TCAIL’s performance depends on the cyclical automotive industry, influenced by economic conditions, fuel prices, and regulations. Weakness in vehicle production or delayed OEM launches can lower demand and pressure margins.
- As per the RHP, about 80 pct of TCAIL’s revenue comes from its top ten OEMs, including Maruti Suzuki, Tata Motors, Mahindra, Hyundai, and Ashok Leyland. This concentration exposes the company to risks from volume declines, program losses, or pricing changes.
- The Clean Air & Powertrain Solutions division contributes around 55-65 pct of revenue. The division faces electrification risks that may lower demand for internal combustion engine vehicles and related products.
Financial Performance
| Particulars | FY23 | FY24 | FY25 | Q1FY26 |
| Sales (Rs. mn) | 48,274 | 54,676 | 48,904 | 1,28,562 |
| EBITDA (Rs. mn) | 5,706 | 6,121 | 8,152 | 2,289 |
| EBITDA Margin % | 11.80% | 11.20% | 16.70% | 17.80% |
| Profit (Rs. mn) | 3,810 | 4,168 | 5,531 | 1,681 |
| Profit Margin % | 7.90% | 7.60% | 11.30% | 13.10% |
| ROE % | 32.90% | 38.10% | 42.70% | 10.40% |
| ROCE % | 33.50% | 45.40% | 56.80% | 16.30% |
Peer Comparison based on FY25 Financials
| Peer Comparison | Tenneco | Bosch | Uno Minda | Gabriel |
| Sales (Rs. mn) | 48,904 | 1,80,874 | 1,67,746 | 40,634 |
| EBITDA (Rs. mn) | 8,152 | 23,097 | 18,740 | 3,917 |
| EBITDA Margin % | 16.70% | 12.80% | 11.20% | 9.60% |
| Profit (Rs. mn) | 5,531 | 20,130 | 10,206 | 2,450 |
| Profit Margin % | 11.30% | 11.10% | 6.10% | 6.00% |
| ROE % | 42.70% | N/A | 17.70% | 22.40% |
| ROCE % | 56.80% | N/A | 18.90% | N/A |
Valuation
Tenneco Clean Air India Limited is a subsidiary of Tenneco Inc., a global leader in designing and manufacturing clean air and powertrain products for automotive applications. Their market leadership is underpinned by long-standing relationships with a broad base of customers including leading Indian and global OEMs. At the upper end of the price of Rs. 397, the issue quotes PE of 24x on FY26 annualized earnings. The issue looks fully priced.
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