Tata Capital Ltd, Backed by Tata Sons, Files for IPO

Tata Sons-backed non-banking financial company (NBFC), Tata Capital Ltd, has taken a significant step towards expanding its market presence by filing draft papers on Monday for an Initial Public Offering (IPO). The move marks a pivotal moment for the company as it seeks to raise substantial capital from the public to support its future growth ambitions.

The proposed IPO by Tata Capital comprises a mix of fresh issuance of new shares and an Offer for Sale (OFS) by existing shareholders. The total equity shares on offer amount to approximately 47.58 crore. Out of this, Tata Capital plans to issue up to 21 crore new shares to raise fresh capital. Meanwhile, the existing shareholders intend to sell around 26.58 crore shares. Tata Sons Private Limited, the company’s promoter, plans to offload up to 23 crore shares through the IPO, and the International Finance Corporation (IFC) has proposed selling approximately 3.58 crore shares.

According to Prime Database, the total size of the issue is estimated to be around Rs 17,000 crore. The shares will have a face value of Rs 10 each. The capital raised from the fresh issuance will primarily be used to strengthen Tata Capital’s Tier-1 capital base. This augmentation is essential for meeting the company’s future capital requirements, including its lending activities and business expansion plans.

Tata Capital is recognized as the third-largest diversified NBFC in India, serving a wide spectrum of lending needs. Its business portfolio covers retail finance, SME finance, and corporate finance. The Reserve Bank of India (RBI) has classified Tata Capital as a systemically important NBFC, which means it is subject to more stringent regulatory oversight and compliance requirements. RBI regulations also mandate that Tata Capital must complete its listing by the end of September.

The company operates as a flagship financial services arm of the Tata Group and functions as a subsidiary of Tata Sons Private Limited. Its focus remains on providing various financial services with a strong emphasis on lending across diverse segments.

Financially, Tata Capital has demonstrated robust growth over the recent fiscal years. The consolidated book size increased significantly from Rs 1,57,760.55 crore as of March 31, 2024, to Rs 2,21,950.37 crore by March 31, 2025. This growth reflects the company’s expanding loan portfolio and asset base. In the fiscal year 2024-25, Tata Capital recorded a consolidated total income of Rs 28,369.87 crore, a substantial increase of 55.89% compared to Rs 18,198.38 crore in the previous fiscal year.

On a standalone basis, the company also showed strong performance, reporting a gross income of Rs 21,940.08 crore in FY2024-25, compared to Rs 13,309.11 crore in FY2023-24. The profit after tax rose moderately to Rs 2,594.28 crore during FY25, up from Rs 2,492.45 crore in the preceding year.

In summary, Tata Capital’s IPO filing underscores its strategy to leverage public equity markets for growth and capital strengthening. The combination of fresh equity and the sale of existing shares provides an opportunity for investors to participate in a well-established NBFC with a broad lending portfolio and strong backing from the Tata Group. With the company’s systemically important status, robust financial growth, and commitment to regulatory compliance, Tata Capital is poised to play a significant role in India’s financial services sector going forward. The IPO is also expected to enhance its capital adequacy, enabling it to continue expanding its lending operations and meet the rising demand for financial products across retail, SME, and corporate sectors.