Tata Capital has filed updated draft papers for an IPO comprising up to 47.58 crore equity shares, 21 crore as fresh issue and 26.58 crore as Offer For Sale (OFS) by Tata Sons (23 crore shares) and IFC (3.58 crore shares).
IPO proceeds will boost Tier-1 capital to support future capital needs and lending. The IPO, estimated at USD 2 billion, could value the company at around USD 11 billion, making it the largest IPO in India’s financial sector.
This listing is part of RBI’s mandate requiring upper-layer NBFCs like Tata Capital (designated in Sept 2022) to go public within 3 years.
For FY25, Tata Capital reported PAT of ₹3,655 crore (up from ₹3,327 crore in FY24), and revenue rose to ₹28,313 crore from ₹18,175 crore. The IPO is managed by a consortium of top investment banks.
Tata Sons-Backed Tata Capital Files Updated Draft Papers with Sebi for IPO
The proposed IPO is a combination of a fresh issuance of 21 crore equity shares as well as an Offer For Sale (OFS) of 26.58 crore shares
Non-banking financial company Tata Capital has filed updated draft papers for an Initial Public Offering (IPO) comprising up to 47.58 crore equity shares.
The proposed IPO is a combination of a fresh issuance of 21 crore equity shares as well as an Offer For Sale (OFS) of 26.58 crore shares, according to the updated Draft Red Herring Prospectus (DRHP) filed on Monday.
Under the OFS, Tata Sons will offload 23 crore shares, and the International Finance Corporation (IFC) will divest 3.58 crore shares.
The funds mobilised through the issue will be used for augmentation of the company's Tier-1 capital base to meet future capital requirements, including onward lending. Tata Capital filed draft papers in April with the markets regulator Sebi for an IPO through a confidential pre-filing route and had received Sebi's approval in July. Following this, companies are required to file an updated DRHP before filing an RHP.
Sources had told PTI that the IPO size could be USD 2 billion, valuing the company at around USD 11 billion.
If successful, this IPO will be the largest initial share sale in the country's financial sector. It will also mark Tata Group's second public market debut in recent years, following the listing of Tata Technologies in November 2023.
This move is part of the company's efforts to comply with the Reserve Bank of India's (RBI's) listing requirements.
As per the RBI mandate, upper-layer NBFCs are required to list on the stock exchange within three years of being designated as such. Tata Capital was categorised as an upper-layer NBFC in September 2022. For the financial year 2024-25, Tata Group's financial services firm reported a PAT of ₹3,655 crore as compared to ₹3,327 crore in FY24, and revenues surged to ₹28,313 crore from ₹18,175 crore. The issue is being managed by a consortium of book-running lead managers, including Axis Capital, Kotak Mahindra Capital Company, BNP Paribas, HDFC Bank, HSBC Securities and Capital Markets (India) Pvt Ltd, Citigroup Global Markets India Pvt Ltd, ICICI Securities, IIFL Capital Services, SBI Capital Markets, and JP Morgan India.