Tata Capital gets Board approval for IPO with fresh issue and OFS

The Board of Directors of Tata Capital Limited (TCL) has approved its initial public offering (IPO), which will include a fresh issue of 23 crores of equity shares and an Offer for Sale (OFS). This move aligns with the Reserve Bank of India's (RBI) requirement for Tata Capital to list its shares by September 2025 as part of the 'upper layer' Non-Banking Financial Companies (NBFCs) regulations. Investors looking to participate in this major offering will soon be able to apply for the IPO.

Tata Capital IPO details

Tata Capital is planning a fresh issue of 23 crore shares that have a face value of ₹10 per share. The promoters will also offload some stake via an Offer for Sale (OFS) but the quantity remains unknown. The company will reveal the issue price band when the issue dates are finalised. 

In addition to the IPO, a rights issue of ₹1,504 crores has also been approved, wherein the record date is February 25, 2025.

Tata Capital’s financial standing and ownership

Tata Capital Limited (TCL), a subsidiary of Tata Sons Private Limited, operates as an NBFC. As per Crisil Ratings, Tata Sons owns 92.83% of Tata Capital, while the remaining shares are held by other Tata group firms as of March 31, 2024.

Tata Sons has demonstrated continued financial support for TCL, having infused ₹6,097 crores over the last five fiscals. Notably, ₹2,500 crores was injected in fiscal 2019, ₹1,000 crores in fiscal 2020, ₹594 crores in fiscal 2023, and ₹2,003 crores in fiscal 2024. This underscores Tata Sons’ intent to expand its lending business.

Alongside the IPO approval, Tata Capital's Board has also sanctioned a rights issue of up to ₹1,500 crores for existing shareholders. The record date for this has been set as February 25, 2025.

Tata Capital’s business operations

Tata Capital and its subsidiaries offer a wide range of financial products and services. Their operations span multiple segments, including:

1. Commercial finance: Providing structured financing solutions to businesses.
2. Wealth services: Offering investment and advisory services.
3. Consumer loans: Catering to individual financing needs.
4. Tata Cards: Distributing and marketing credit card services.

Tata Investment Corporation shares gain

Following the IPO announcement, Tata Investment Corporation Limited shares saw an 8% rise, reaching ₹6,218 per share. At its intraday high, the stock surged by 8.51%. The company’s market capitalisation currently stands at ₹31,460.16 crores.

Invest safely

Tata Capital Limited’s IPO is a significant development for the Tata Group’s financial services segment. With a fresh issue, an OFS component, and a rights issue, the company is preparing for substantial market participation. 

As of 12:30 PM on February 25, 2025, Tata Investment Corporation Limited’s share price of ₹6,167.58 reflects positive investor sentiment regarding the IPO plans. As investor interest grows, those keen to participate in the offering should prepare to apply for the IPO.