Tata Capital Limited, the financial services subsidiary of Tata Sons, operates as a non-banking financial company – investment and credit company (NBFC-ICC). The company has announced plans to go public via an initial public offering (IPO) of approximately ₹18,000 crore, consisting of a fresh issue of up to 230 million equity shares and an offer for sale by existing shareholders. The IPO is subject to regulatory approvals and prevailing market conditions. Tata Sons, which holds a 92.83% stake in Tata Capital, is expected to dilute part of its holding through this offer. The board has also approved a ₹1,504 crore rights issue ahead of the IPO to strengthen capital ahead of the listing.
Tata Capital offers a broad portfolio of financial services tailored to retail, SME, and institutional clients. These include personal loans, business loans, home loans, consumer finance, wealth product distribution, private equity, leasing solutions, and cleantech finance. Its subsidiaries, Tata Capital Housing Finance and Tata Securities, expand the company’s reach into affordable housing finance and institutional broking. The company also markets Tata Cards issued by SBI Cards. With a growing loan book, digital initiatives, and presence across key lending verticals, Tata Capital holds a prominent position in India’s NBFC landscape, reflecting its diversified, long-term approach to credit growth.
About Tata Capital
Tata Capital Limited, a fully owned subsidiary of Tata Sons, operates as a non-banking financial company – investment and credit company (NBFC-ICC) under registration with RBI. Established in 2007, it serves as the flagship financial services arm of the Tata Group and operates under the brand promise of “We only do what’s right for you.” The company offers financial services to a diverse customer base across retail, corporate, and institutional segments.
Key Offerings:
- Retail Finance: Personal loans, home loans, car loans, education loans, and consumer durable finance.
- Business Finance: SME loans, working capital loans, machinery loans, and commercial vehicle funding.
- Wealth Management: Mutual funds, bonds, and portfolio advisory services.
- Leasing and Equipment Finance: Structured leasing, medical equipment leasing, and infrastructure funding.
- Cleantech Finance: Loans for renewable energy and sustainable projects.
- Distribution and Advisory: Insurance, investments, and financial planning.
Tata Capital’s subsidiaries—Tata Capital Housing Finance Limited and Tata Securities Limited—further extend its reach into housing finance and capital market distribution. The company also promotes Tata Cards, issued by SBI Cards. With a wide distribution footprint and a focus on digital transformation, Tata Capital plays a significant role in driving credit accessibility and financial inclusion across India.
Latest Update of Tata Capital IPO
Tata Capital’s IPO process has officially commenced and is currently at the regulatory approval stage. Below is a quick overview of recent developments:
- The company has filed a confidential draft red herring prospectus (DRHP) with SEBI under the pre-filing route introduced in 2022.
- The IPO is expected to raise approximately ₹15,000 crore, combining a fresh issue and an offer for sale.
- Tata Sons and IFC, two existing shareholders, are likely to dilute part of their holdings.
- The listing aligns with RBI’s mandate requiring upper-layer NBFCs to be listed by September 2025.
- Ahead of the IPO, a ₹1,504 crore rights issue was approved by Tata Capital’s board.
- Ten investment banks, including Kotak Mahindra Capital, Axis Capital, and Citi, have been appointed to manage the issue.
- Market observers are closely tracking the listing timeline, pending SEBI’s review and market conditions.
Tata Capital Has Submitted a Confidential IPO Filing With SEBI, Aiming for a ₹15,000 Crore Listing
Tata Capital has formally initiated the IPO process by filing a confidential draft red herring prospectus (DRHP) with the Securities and Exchange Board of India. The ₹15,000 crore issue will include a fresh issue of up to 230 million shares, and an offer for sale by existing shareholders such as Tata Sons and the International Finance Corporation. The pre-filing mechanism allows the company to protect competitive business data during the early regulatory review process, helping avoid premature market speculation. This route also provides the flexibility to withdraw or revise the offer without public scrutiny if needed.
As of March 2024, Tata Sons held a 92.83% stake in Tata Capital and is expected to remain the majority shareholder post-listing. The IPO is aimed at meeting regulatory requirements and supporting the company’s capital adequacy. Tata Capital also approved a ₹1,504 crore rights issue in February 2024, which Tata Sons is expected to subscribe to fully. The company joins a growing list of Indian firms—like Tata Play and Credila Financial Services—leveraging the confidential filing route introduced by SEBI in November 2022. Final IPO timelines will depend on SEBI observations and market readiness.
Tata Capital IPO Details and Objectives
Tata Capital’s IPO has been approved by its board and is structured to include both a fresh equity issue and an offer for sale. The company has submitted a confidential draft red herring prospectus (DRHP) to SEBI. The listing is expected to comply with the RBI’s mandatory listing norms for upper-layer NBFCs. The following table provides an overview of the Tata Capital IPO.
Component
| Details
|
IPO Size (Estimated)
| ₹15,000 crore
|
Fresh Issue
| Up to 230 million equity shares
|
Offer for Sale (OFS)
| Stake dilution by Tata Sons and International Finance Corporation (IFC)
|
Equity Share Face Value
| ₹10 per share
|
Rights Issue Approved
| ₹1,504 crore
|
Listing Mandate Deadline
| September 2025 (as per RBI directive for upper-layer NBFCs)
|
Regulatory Status
| Confidential DRHP filed with SEBI
|
Lead Managers
| Kotak Mahindra Capital, Axis Capital, Citi, JP Morgan, among others
|
Purpose of the IPO
The objectives behind Tata Capital’s IPO are focused on strengthening financial stability, improving operational scale, and meeting regulatory norms. The fresh issue component of the IPO will be used for:
- Capital Adequacy: Enhancing Tier-I capital to support continued growth in lending operations and ensure compliance with RBI’s capital norms for NBFCs.
- Business Expansion: Increasing the loan book by scaling operations across retail, SME, and institutional lending.
- Digital Transformation: Funding technology upgrades to improve automation, digital outreach, and customer service capabilities.
- Strategic Investments: Enabling flexibility for potential future investments or acquisitions aligned with long-term growth objectives.
The offer for sale will allow existing stakeholders—primarily Tata Sons—to partially exit and comply with listing requirements. It will not contribute to Tata Capital’s capital inflow but is part of the broader restructuring and compliance strategy under evolving NBFC regulations.
How to Apply for the Tata Capital IPO?
Investors interested in subscribing to the Tata Capital IPO can apply online using a brokerage app or website. The application process is digital and follows a standardised format available on the platform. Brokerage platforms allow users to participate in primary market offerings directly from their trading and demat account. To begin the application, investors must log in to their brokerage account and follow the listed steps to complete the IPO application. All instructions provided are in accordance with the platform’s official IPO application process for retail investors using the UPI-based payment mechanism.
Online Application Process
- Login to Your Brokerage Account: Open the app or website and log in with your registered credentials.
- Locate the IPO Section: Navigate to the ‘IPO’ tab within the dashboard interface.
- Select the IPO: Find and select Tata Capital IPO from the list of active or open IPOs.
- Enter the Lot Size: Specify the number of lots you wish to apply for in the offering.
- Submit Your UPI ID: Enter your UPI ID to link your payment method and proceed with the application.
- Approve Funds on UPI App: You will receive a UPI mandate request—approve the payment by entering your UPI PIN.
- Receive Confirmation: Upon successful submission, you will receive a confirmation message from your brokerage service.
- Check Allotment Status: Your brokerage service will notify you via push notification and email once the allotment is completed.
Financial Health & Performance of Tata Capital Limited
The following table presents a year-on-year comparison of Tata Capital Limited’s key financial metrics for FY23 and FY24.
Particulars
| Year ending on March 31, 2023
| Year ending on March 31, 2024
|
Revenue from Operations
| ₹13,628.58 crore
| ₹18,174.28 crore
|
Total Income
| ₹13,637.49 crore
| ₹18,198.38 crore
|
Expenses
| ₹9,847.63 crore
| ₹9,568.23 crore
|
Profit After Tax
| ₹2,945.77 crore
| ₹3,326.96 crore
|
Total Assets
| ₹1,35,626.10 crore
| ₹1,76,693.98 crore
|
Loans
| ₹1,16,788.79 crore
| ₹1,57,760.55 crore
|
- Revenue from operations increased from ₹13,628.58 crore to ₹18,174.28 crore over the one-year period.
- Total income rose from ₹13,637.49 crore in FY23 to ₹18,198.38 crore in FY24.
- Expenses declined slightly, from ₹9,847.63 crore in FY23 to ₹9,568.23 crore in FY24.
- Profit after tax improved from ₹2,945.77 crore in FY23 to ₹3,326.96 crore in FY24.
- Total assets grew from ₹1,35,626.10 crore to ₹1,76,693.98 crore during the same period.
- Loans disbursed rose to ₹1,57,760.55 crore from ₹1,16,788.79 crore, reflecting an increase in lending activity.
Investment Risks and Opportunities
Tata Capital’s IPO arrives at a time when the NBFC sector is undergoing both structural transformation and regulatory tightening. While the company shows strong financial growth and market positioning, investors must consider the underlying sectoral and operational risks. The upcoming listing also coincides with regulatory mandates and a shift in credit demand across retail and MSME segments.
Potential Risks of Investing in the IPO
- Exposure to economic fluctuations, interest rate changes, and inflation may impact borrower repayment capacity and overall financial performance.
- An increase in borrower defaults and delayed repayments may lead to higher non-performing assets (NPAs), potentially impacting profitability and overall operational stability.
- Revisions to financial regulations, provisioning guidelines, or compliance obligations may influence operational workflows and affect capital adequacy.
- A drop in asset values may reduce loan recovery rates, posing risks to financial stability and lending operations.
- The company operates in a highly competitive market, which could affect margins and loan growth.
- Any significant rise in credit costs may impact return ratios and funding availability.
Opportunities and Growth Potential
- Tata Capital operates in the context of India’s expanding financial services sector, where retail credit is projected to grow at a CAGR of 13–15% through FY27.
- The NBFC sector is projected to grow at a CAGR of 15–17%, supported by increasing demand for retail and MSME lending, which may create growth opportunities for the company.
- Government initiatives such as Udyam Assist and PM Vishwakarma are aimed at improving credit access for MSMEs, creating opportunities for financial institutions operating in this segment, including Tata Capital.
- By offering a diversified portfolio of financial products across retail, SME, and corporate segments, the company is able to extend its market presence and broaden its revenue base.
- Its subsidiaries provide access to housing finance, securities trading, and wealth distribution, strengthening its diversified presence.
- Ongoing digital transformation may improve customer acquisition, cost efficiency, and operational scale.
Key Performance Indicator (KPI)
The following table highlights the key performance indicators for Tata Capital Limited based on its latest financial disclosures:
KPI
| Values
|
ROE
| 18.42%
|
ROCE
| 20.76%
|
Debt/Equity
| 0.47
|
RoNW
| 18.42%
|
PAT Margin (%)
| 4.24
|
Tata Capital IPO Registrar & Lead Managers
Tata Capital has appointed 10 investment banks to manage its proposed ₹15,000 crore IPO. These lead managers are responsible for handling the IPO filing and supporting the regulatory and procedural process. The draft red herring prospectus (DRHP) has been filed confidentially with SEBI under the pre-filing route. The registrar responsible for finalising the basis of allotment and managing post-issue investor services is expected to be confirmed in the final offer documents, after the company proceeds to file the RHP after SEBI review.
Lead Manager
| Role in IPO
|
Kotak Mahindra Capital
| Appointed as IPO advisor
|
Citi
| Appointed as IPO advisor
|
JP Morgan
| Appointed as IPO advisor
|
Axis Capital
| Appointed as IPO advisor
|
ICICI Securities
| Appointed as IPO advisor
|
HSBC Securities
| Appointed as IPO advisor
|
IIFL Capital
| Appointed as IPO advisor
|
BNP Paribas
| Appointed as IPO advisor
|
SBI Capital
| Appointed as IPO advisor
|
HDFC Bank
| Appointed as IPO advisor
|
Company Address of Tata Capital Limited
Tata Capital Limited is headquartered in Mumbai, Maharashtra, and operates as a subsidiary of Tata Sons. Its registered office is located at:
Registered Office
11th Floor, Tower A,
Peninsula Business Park,
Ganpatrao Kadam Marg,
Lower Parel, Mumbai – 400013, Maharashtra, India.
This is the official corporate address used for regulatory, legal, and public listing purposes. All formal correspondence regarding the IPO, regulatory filings, and statutory disclosures are associated with this location. The final offer documents, including the Red Herring Prospectus (RHP), will provide detailed contact information for investor-related queries once SEBI approvals are received.
Industry Outlook of Tata Capital IPO
- NBFC credit is projected to grow at a CAGR of 15–17% between FY24 and FY27, driven by rising demand from the retail and MSME sectors.
- As of FY24, NBFCs account for 21% of total systemic credit, highlighting their growing importance in India’s lending ecosystem.
- Traditional banks are increasingly focused on wholesale and corporate lending, creating space for NBFCs to serve underserved and higher-risk segments.
- NBFCs are playing a key role in enhancing financial inclusion, especially in semi-urban and rural areas.
- Policy support, including government-backed credit schemes, is expected to further boost NBFC lending capacity.
- Regulatory classification of “upper-layer NBFCs” underscores the systemic relevance of large players like Tata Capital.
Strengths & Risks of Tata Capital Ltd
Tata Capital operates as a diversified non-banking financial company (NBFC) with a growing presence across retail, SME, and institutional lending segments. Its position within the Tata Group and a broad product portfolio provide operational and funding stability. However, like all large financial institutions, Tata Capital remains exposed to macroeconomic pressures, credit risk, and evolving regulatory frameworks. Investors should evaluate both structural advantages and underlying risk factors before interpreting the company’s outlook in the context of its proposed IPO.
Strengths
- Tata Capital operates within India’s growing financial services space, where retail credit is expected to expand at a compound annual growth rate (CAGR) of 13–15% through FY27.
- The NBFC sector itself is expected to grow at a 15–17% CAGR, offering structural tailwinds to companies with wide lending footprints.
- Government schemes like Udyam Assist and PM Vishwakarma promote MSME credit access, creating lending opportunities.
- Tata Capital’s offerings span retail, SME, and corporate finance, supporting multi-segment market penetration.
- Its subsidiaries extend reach into housing finance and institutional distribution, diversifying revenue channels.
- The company's loan book growth, digital expansion, and operational scale enhance business resilience.
- Backing from Tata Sons reinforces financial credibility and brand trust.
Risks
- Exposure to economic fluctuations, inflation, and interest rate changes may impact borrowers’ repayment ability.
- A rise in borrower defaults or delays can increase non-performing assets, affecting earnings and operational stability.
- Regulatory changes, including provisioning and capital adequacy norms, may affect lending operations and compliance requirements.
- A drop in asset values may reduce loan recovery, especially in unsecured lending segments.
- Operational and credit risks are elevated due to the company’s exposure to retail and MSME borrowers.
- Rising competition across NBFCs and banks could exert pressure on margins and loan pricing.
- Delay in regulatory approvals or listing timelines could impact IPO execution strategy.
Conclusion
Tata Capital’s proposed IPO marks a significant milestone in the company’s evolution as a diversified NBFC. With a strong parentage, growing loan book, and presence across key retail and institutional segments, the company is aligning itself with regulatory expectations and long-term market participation.
While the listing is subject to SEBI approval and market conditions, the IPO structure reflects the company’s focus on capital adequacy, operational expansion, and compliance with RBI’s listing mandate for upper-layer NBFCs.
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