A combined study employing density functional theory (DFT) using the experimentally determined modulated structures in the martensite phase and bulk-sensitive hard x-ray photoelectron spectroscopy of stoichiometric single-crystalline  is presented in this paper. The experimental valence band (VB) features closely match the theoretical VB calculated by DFT using generalized gradient approximation for both the martensite and austenite phases. We establish the existence of a charge density wave (CDW) state in the martensite phase from the shape of the VB near the Fermi level (). This shows (i) a transfer of spectral weight from the near  region to the higher binding energy side resulting in a dip-peak structure in the difference spectrum that is in excellent agreement with DFT and (ii) presence of a pseudogap at  that is portrayed by fitting the near  region with a power-law function. The present paper emphasizes the electronic origin and the role of the atomic modulation in hosting the CDW state in the martensite phase of stoichiometric .