IPO Timeline and Valuation
Tata Capital is gearing up to launch its maiden public offering in the first half of October, aiming to raise 2 billion dollars or more than Rs 17,000 crore. This comes after the Reserve Bank of India extended the company’s deadline to list on the stock exchanges beyond the earlier September 30 cutoff. The upcoming issue values Tata Capital at around 18 billion dollars, representing a sharp increase from the 11 billion dollar valuation when it filed confidential IPO papers in April.
Largest Issue in India’s Financial Sector
If successful, Tata Capital’s IPO will be one of the biggest in India’s financial services space. It will only be surpassed by Hyundai Motor India’s record 3.3 billion dollar issue in October 2024. Market observers note that large IPOs often see such timeline extensions, similar to how NSDL’s 4,000 crore rupee IPO was delayed by months before eventually launching.
Structure of the Offering
According to the updated Draft Red Herring Prospectus filed in August, the IPO will include a fresh issue of up to 21 crore equity shares along with an offer for sale of up to 26.58 crore shares, making a total of 47.58 crore shares. Promoter Tata Sons plans to divest up to 23 crore shares, while International Finance Corporation will offload up to 3.58 crore shares. Tata Sons currently owns 88.6 percent of Tata Capital, with IFC holding 1.8 percent. The proceeds from the fresh issue will be used to augment Tier-I capital and fuel lending growth, reinforcing the company’s position as a leading non-banking financial services player.
Compliance with RBI Mandates
The IPO is also part of regulatory compliance. Tata Capital was designated as an upper-layer non-banking finance company in September 2022, and the Reserve Bank mandates that such firms must be listed within three years. The upcoming offering aligns with this requirement, putting Tata Capital on track to meet the regulatory timeline while strengthening its market presence.
Strong Financial Performance
Tata Capital’s financials ahead of the IPO have bolstered investor confidence. In the first quarter of FY26, the company reported a net profit of Rs 1,041 crore, more than doubling the Rs 472 crore recorded a year earlier. Total income rose to Rs 7,692 crore compared to Rs 6,557 crore in the same period of the previous year. Such growth signals robust business momentum and enhances the attractiveness of the IPO to both institutional and retail investors.
Global Roadshows and Investor Interest
In August, Tata Capital conducted investor roadshows across major global financial hubs including Hong Kong, Singapore, London, and New York, along with key Indian cities. The events attracted strong interest from both international and domestic investors, setting the stage for significant demand when the issue opens.
A Landmark for Tata Group
The IPO will be the Tata Group’s second listing in recent years following the successful debut of Tata Technologies in November 2023. It also comes in the wake of other major NBFC listings such as HDB Financial Services and Bajaj Housing Finance, both of which saw strong market debuts. Tata Capital’s listing underscores the Tata Group’s ongoing strategy of unlocking value through public markets while meeting regulatory obligations.
Tata Capital’s IPO is set to be a defining event in India’s capital markets, blending the strength of the Tata brand with strong financial performance and growing investor appetite for financial services companies. With an 18 billion dollar valuation target, this listing is poised to capture widespread attention and mark a new chapter for the Tata Group in the public markets.
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