Tata Capital Eyes $20 Billion Valuation in Landmark IPO Filing

Image Source: India IPO

IPO Momentum Builds:

Tata Capital is preparing to file an updated Draft Red Herring Prospectus (DRHP) this week, targeting a valuation between $18 billion and $20 billion.

The IPO is expected to be one of India’s largest in the financial services sector, potentially raising over Rs 15,000 crore through a mix of fresh issuance and offer-for-sale by Tata Sons and IFC.

Strategic Context:

The listing aligns with RBI’s mandate requiring upper-layer NBFCs to go public by September 2025.

Tata Capital’s board has already approved the listing of 23 crore shares and a rights issue worth Rs 1,504 crore to bolster capital ahead of the IPO.

Valuation Drivers:

The company’s diversified portfolio across retail lending, infrastructure finance, and wealth management supports its premium valuation.

Recent merger approval with Tata Motors Finance is expected to enhance operational scale and credit penetration.

Market Positioning:

Tata Capital has finalized 10 investment banks to manage the IPO, indicating strong institutional interest.

The firm may opt for a confidential filing route, following the path of other Tata Group entities like Tata Play and Tata Technologies.

Forward Outlook:

Analysts anticipate robust demand from institutional and retail investors, given Tata Capital’s brand strength and growth trajectory.

The IPO could serve as a benchmark for future NBFC listings, reinforcing investor confidence in India’s financial sector.

Closing Insight: Tata Capital’s IPO ambitions reflect the Tata Group’s broader push toward unlocking value and deepening market participation in India’s evolving financial landscape.

Source: Bloomberg, Moneycontrol, Economic Times