Tata Capital Prepares for $2 Billion IPO Ahead of RBI Deadline

Tata Capital is preparing to launch a $2 billion IPO ahead of the RBI's September 30 deadline. The financial services arm of the Tata Group plans to offer 210 million new shares and 266 million existing shares. Tata Sons and IFC will pare their stake, with Tata Sons offloading 230 million shares and IFC selling 35.8 million shares. The IPO will be managed by a consortium of lead managers and is aimed at complying with the RBI's mandate for upper-layer NBFCs to list within three years of designation.

Title: Tata Capital's $2 Billion IPO: A Comprehensive Overview

Tata Capital, a prominent financial services arm of the Tata Group, is preparing to launch a $2 billion Initial Public Offering (IPO) before the Reserve Bank of India's (RBI) September 30 deadline. The IPO, scheduled to be one of the largest in India's financial sector, is aimed at complying with the RBI's mandate that upper-layer non-banking financial companies (NBFCs) must list within three years of designation.

The IPO will comprise 210 million new shares and 266 million shares for sale by existing shareholders. Tata Sons, which holds 88.6% of Tata Capital, plans to offload 230 million shares, while International Finance Corporation (IFC) will sell 35.8 million shares. IFC currently owns 1.8% of the company. Overall, Tata Group firms own 95.6% of Tata Capital [1].

The upcoming IPO is being managed by a consortium of lead managers, including Axis Capital, Kotak Mahindra Capital, BNP Paribas, HDFC Bank, HSBC Securities and Capital Markets (India), Citigroup Global Markets India, ICICI Securities, IIFL Capital Services, SBI Capital Markets, and JP Morgan India [3].

Tata Capital's strong earnings momentum is a significant factor in its IPO plans. The company reported a consolidated net profit of Rs 1,040.93 crore for the June quarter, more than double the Rs 472.21 crore it posted a year earlier. Total income rose to Rs 7,691.65 crore in the period from Rs 6,557.40 crore a year ago [3].

This IPO is a strategic move for Tata Capital, aiming to strengthen its Tier-I capital base and enable future business expansion and onward lending. The funds will be utilized to cater to a wider base of retail, SME, and corporate borrowers, enhancing Tata Capital's ability to meet the growing demand for financial services [2].

The IPO price band and subscription dates are yet to be finalized, with the company expected to announce these details in late August or early September 2025. Investors can look forward to an investor roadshow and anchor investor placements before the IPO opens for retail and institutional investors [1].

In conclusion, Tata Capital's $2 billion IPO is a significant event in India's financial sector, marking the company's compliance with the RBI's regulatory mandate and positioning itself for future growth and expansion.

References:
[1] https://ipocentral.in/tata-capital-ipo-update/
[2] https://www.financialexpress.com/market/ipo-news-tata-capital-ipo-8-things-you-must-know-before-investing-in-tata-groups-latest-offer-3951278/
[3] https://m.economictimes.com/markets/ipos/fpos/tata-capital-to-launch-2-bn-ipo-ahead-of-sept-30-rbi-deadline-report/articleshow/123428774.cms?UTM_Campaign=RSS_Feed&UTM_Medium=Referral&UTM_Source=Google_Newsstand