Tenneco Clean Air IPO Subscription Begins: GMP Trends, Review, and Why It Matters

Tenneco Clean Air India makes high-tech parts for cars, trucks, and other vehicles, mainly things that help engines run clean and smooth. The company’s initial public offering (IPO) opens from November 12 to November 14, 2025, with shares priced between ₹378 and ₹397. The GMP is about ₹61, showing an expected 15% gain, but remember: GMP is just an unofficial indicator, and it can change fast based on the mood of investors.

In this blog, you’ll find out what the company does, where the IPO money goes, its strengths and risks, how it stacks up against rivals, and an easy-to-understand take on its financial numbers and the people running the show.

IPO Overview

• IPO Date: November 12 to November 14, 2025
• Total Issue Size: ₹3,600 crore
• Price Band: ₹378 to ₹397 per share
• Minimum Investment: ₹14,689
• Lot Size: 37 Shares
• Tentative Allotment Date: November 17, 2025
• Listing Date: November 19, 2025 (Tentative)
• GMP: The GMP for the Tenneco Clean Air IPO is ₹61, reflecting a 15.37% gain over the issue price, according to Chittorgarh.com.

Disclaimer: GMP is an unofficial indicator and is subject to market volatility.

Business Model of Tenneco Clean Air

Tenneco Clean Air India manufactures important automobile components, mainly emission-control systems (to reduce pollution in vehicle exhaust) and advanced suspension systems (for a smoother ride). For every car or truck that wants to pass strict government rules on pollution and perform well on roads, these parts are non-negotiable.

• Who Buys? The main customers are India's biggest automakers, like Maruti Suzuki, Tata Motors, and Mahindra, who use these high-tech parts in passenger cars (PVs) and commercial trucks (CTs).
• How Does the Money Flow? The company buys raw materials, builds or assembles the specialized parts using advanced technology or designs from its global parent, and ships out fully-built components directly to automakers’ factories. Building these strong, long-lasting business ties means that the company keeps getting repeat orders, with an average customer relationship lasting over 19 years.​​
• Breakdown by Business: About 57% of its revenue comes from clean air solutions (things like catalytic converters and mufflers that help with emission norms), and about 43% from ride technologies (shock absorbers and suspension systems that make vehicles comfortable to drive).

Objectives of the IPO

Offer for Sale (OFS): All the money raised, ₹3,600 crore, will go to the selling shareholder, Tenneco Mauritius Holdings. The company itself won’t get any of the proceeds. This means the IPO is not raising “fresh” funds for expansion or debt repayment; it's simply a way for the main promoter to unlock value and provide exit liquidity.​​

Listing Benefits: By listing its shares, the company gets more visibility and public trust, making it easier to do business, attract more investors, and maybe raise funds more easily in the future. Listing also helps regular people own a piece of the company.

Strengths:

• Market Leadership: The company supplies 57% of pollution-control systems for commercial trucks and 52% of shock absorbers for passenger vehicles in India. Being the biggest in these segments helps it win large, long-term orders.​​
• Strong Relationships: It works with all the top passenger car and commercial vehicle makers, showing trust and reliability. The top ten clients have been with the company for over 19 years on average.
• Efficient Operations: Return on Capital Employed (ROCE) is a high 56.78%. This means that for every ₹100 used in the business, the company made about ₹57 profit before interest and tax, one of the best ratios among its peers.
• Net Cash Position: The company operates debt-free, always having more cash than loans. This makes it resilient against tough times.
• Quick Cash Cycle: Its cash conversion cycle is negative (–24 days), meaning it gets paid by customers before it has to pay its suppliers. This gives it extra free cash to use for growth.

Risks:

• High Dependency on a Few Clients: More than 80% of revenue comes from its top ten customers. Losing one big customer could hit sales and profits hard.​​
• Auto Sector Cyclicality: The business depends a lot on the overall auto market, which can swing based on the economy. If car sales or truck sales in India slow down, the company could struggle.
• Commodity Price Shock: About 65% of expenses are for raw materials like steel. If steel prices rise quickly, profits could take a hit.
• Capacity Limits: Some key factories are working at near full capacity. If demand shoots up suddenly, it may not be able to supply enough without expanding plants.
• Product Risk from Electrification: As more electric vehicles (EVs) hit the roads, the need for the classic emission-control parts for petrol or diesel vehicles could drop over time.
• Pure OFS IPO: Since all IPO money goes to the promoter, the company doesn’t get new investment for growth or reducing any debt.​

For detailed information, visit Tenneco Clean Air’s official IPO page at INDmoney.

Peer Comparison

• Profitability: Tenneco Clean Air shows an ROCE of 56.78% versus a peer average of about 27.5%. Return on Equity (ROE) is also high at 42.65%, way above the industry average of 22.2%.
• Cash Management: Its negative cash conversion cycle (–24 days) is best in class. Most peers have to wait almost a month to get their money back.
• Scale: However, the company’s revenue is about ₹4,890 crore, smaller than Bosch (₹18,087 crore), a much bigger rival.
• Margins: EBITDA margin is 16.67%, just slightly above the peer average but lower than the most specialized competitors. Net profit margin stands at about 11.3%, a tad higher than peers but not the absolute best.​​

Tenneco Clean Air’s Financial Performance

• Revenue Trend: Revenue grew from ₹4,827 crore in FY23 to ₹5,468 crore in FY24, but fell to ₹4,890 crore in FY25, mainly as prices dropped for special "substrates" (parts with precious metals) and more customers bought cheaper options.​​
• Profit Growth: Net profit jumped from ₹381 crore in FY23 to ₹552 crore in FY25, thanks to cost savings and strong operational control, even as sales dipped. This is a 20.5% growth per year on average for profit.
• Strong Margins: EBITDA margin (the profit from core operations as a percentage of sales) rose from 11.8% in FY23 to 16.7% in FY25.
• Balance Sheet: The company holds zero loans and plenty of cash, which is rare and shows it doesn’t take big financial risks.

Tenneco Clean Air IPO Valuation

The IPO values the company at a total market cap of about ₹16,023 crore, with shares priced at a P/E (Price to Earnings) ratio of 29. This means, for every ₹1 of profit made last year, investors are paying ₹29 if they buy at the top price. The average industry P/E is 48, so the IPO is priced cheaper than most rivals right now. The company’s strong profit and cash efficiency help justify the price, making it seem reasonable for the sector, but always remember that the market prices shares after listing based on future expectations.​​

Disclaimer: The P/E ratio here is calculated using the company’s post-IPO equity and its most recent FY25 net profits at the upper end of the price band.

Who Leads Tenneco Clean Air?

• Arvind Chandrasekharan (Chief Executive Officer): With over 21 years in automotive and two Master’s degrees (including an MBA), he leads the company’s strategy. His compensation is about ₹6.74 crore a year. He also receives special bonuses for the IPO’s success and education reimbursement, showing how global the company’s approach is.
• Mahender Chhabra (Chief Financial Officer): With over 27 years in various big companies like Microsoft and Motherson Sumi, he ensures the company’s money is carefully managed.
• Roopali Singh (Company Secretary & Compliance Officer): Boasting over 20 years’ experience, she handles all regulatory and legal matters.
• Niranjan Kumar Gupta (Chairman): Formerly CEO of Hero MotoCorp, he brings deep industry insight and is paid ₹1 crore a year.

Selling Shareholders: What the OFS Means

This IPO is 100% an offer for sale. The parent, Tenneco Mauritius Holdings, is selling shares to Indian public investors and will take home all ₹3,600 crore raised. The company does not get any money for new projects. The promoter originally bought the shares at various prices, but the average was ₹138.14 per share, and some shares were acquired much higher, at ₹288.85, earlier this year. The current IPO price gives the promoter a solid gain, and it's a standard exit for a global investor.

Industry Outlook

India's auto-component sector is booming, rising at a 13.4% annual growth rate to nearly ₹8.6 lakh crore in FY25. Major growth drivers include stricter pollution control laws (making clean-air parts more valuable), big government projects (more vehicles on the roads), and rising incomes (with more people buying premium cars and SUVs). Yet, the industry faces challenges like swings in car sales when the economy dips, risk from high commodity prices (like steel), and the steady move towards electric vehicles (which could reduce demand for traditional auto parts).

Analyst View

Tenneco Clean Air India stands out for its strong customer base, high efficiency, and solid financial track record. The IPO pricing looks reasonable compared to similar companies, and its core markets are growing. The leadership team is experienced and global. However, the company’s future depends a lot on the overall auto industry, and if the world moves quickly to electric vehicles, demand for some of its best products could drop. Also, since this IPO raises no fresh money for the business (pure OFS), new investors should not expect a direct boost to growth from this public issue itself.

Investors should look at both the long-term growth benefits and these risks before getting excited about the IPO. Always make sure you’re comfortable with the ups and downs of the auto industry, and remember that past outperformance doesn’t always guarantee future results.

For a seamless application process, visit the INDmoney IPO page.

Disclaimer

Source: Tenneco Clean Air's RHP. Investments in the securities market are subject to market risks. Read all the related documents carefully before investing. Please be informed that merely opening a trading and demat account will not guarantee investment in securities in the IPO. Investors are requested to do their own independent research and due diligence before investing in an IPO. Please read the SEBI-prescribed Combined Risk Disclosure Document prior to investing. This post is for general information and awareness purposes only and is nowhere to be considered as advice, recommendation, or solicitation of an offer to buy or sell, or subscribe for securities. INDstocks is acting as a distributor for non-broking products/services such as IPO, Mutual Fund, and Mutual Fund SIP. These are not exchange-traded products. All disputes with respect to the distribution activity would not have access to the Exchange investor redressal forum or the Arbitration mechanism. INDstocks Private Limited (formerly known as INDmoney Private Limited) does not provide any portfolio management services, nor is it an investment adviser. Logos above are the property of respective trademark owners, and by displaying them, INDstocks has no right, title, or interest in them. SEBI Stock Broking Registration No: INZ000305337, Trading and Clearing Member of NSE (90267, M70042) and BSE, BSE StarMF (6779), SEBI Depository Participant Reg. No. IN-DP-690-2022, Depository Participant ID: CDSL 12095500, Research Analyst Registration No. INH000018948 BSE RA Enlistment No. 6428.