The long-awaited Tata Capital IPO is opening for subscription from 6 – 8 October 2025. It is easily one of the most talked-about public issues of the year, not only because it carries the prestige of the Tata Group, but also because Tata Capital has grown into a systemically important diversified NBFC in India.
In financial circles, Tata Capital IPO is being viewed as a landmark event, with investors eager to participate in a business that has shown 37% CAGR loan book growth in the last two years and now seeks to strengthen its capital base for future expansion.
For investors, however, excitement alone is not enough. A deeper look into the company’s fundamentals, its financial strength, and the structure of the IPO is essential. Here’re key details of Tata Capital IPO that every investor must understand before applying.
Table of Contents
Tata Capital IPO: Company Snapshot
Tata Capital was incorporated in 2007 and serves as the flagship financial services arm of the Tata Group, a 156-year-old conglomerate with interests across steel, automobiles, IT, and consumer products.
- Market Position: Tata Capital is currently the third-largest diversified NBFC in India with a total gross loan book of INR 2,33,400 crore as of 30 June 2025. Between March 2023 and March 2025, the loan book grew at a CAGR of 37.3%, highlighting the company’s aggressive expansion.
- Distribution: The company has built a strong physical and digital presence with 1,516 branches across 27 states and union territories. Its distribution is further supported by digital lending platforms, direct selling agents (DSAs), original equipment manufacturer (OEM) tie-ups, and dealer partnerships.
- Customers & Employees: The company services 73 lakh customers with an employee strength of 28,813.
- Merger Impact: In May 2025, Tata Capital merged with Tata Motors Finance (TMFL), significantly strengthening its position in the vehicle finance segment. This merger brought in an additional 6,351 employees and 353 branches. TMFL now contributes 92.5% of commercial vehicle loans, 16.8% of car loans, and 12.8% of supply chain finance, broadening Tata Capital’s lending portfolio.
Tata Capital is no longer a niche NBFC. It has transformed into a large-scale, diversified lender with a strong retail and SME focus, an extensive physical and digital footprint, and the backing of the Tata brand.
Tata Capital IPO Structure
The Tata Capital IPO is structured as a combination of a fresh issue and an offer for sale (OFS).
Issue Size
- Fresh Issue: 21 crore equity shares
- Offer for Sale (OFS): 26.58 crore shares (primarily by promoter Tata Sons and investor IFC)
- Total IPO Size: 47.58 crore shares
Book Running Lead Managers (BRLMs): A large consortium including Kotak Mahindra Capital, Axis Capital, BNP Paribas, Citigroup, HDFC Bank, HSBC, ICICI Securities, IIFL Capital, JP Morgan, and SBI Capital Markets.
Registrar: MUFG Intime India.
The large number of top-tier investment banks handling the IPO signals the significance of this offering.
Use of Funds
Unlike some IPOs where funds are diverted towards debt repayment or acquisitions, Tata Capital is keeping it simple.
- 100% of the net proceeds from the fresh issue will be used to augment Tier I capital.
- This strengthened equity base will allow the company to:
- Expand lending operations to support future demand.
- Maintain a comfortable Capital Adequacy Ratio (CRAR) in line with RBI’s Scale-Based Regulations, which impose stricter norms on large NBFCs.
This is a pure growth capital raise. The company is not carrying distressed debt that needs to be repaid; instead, it is raising equity to fuel lending growth and stay regulatory-compliant. For investors, this signals confidence in future expansion rather than financial stress.
Tata Capital IPO: Shareholding Pattern
As of 24 September 2025 (pre-IPO), Tata Capital’s equity is heavily promoter-owned, with Tata Sons Private holding the lion’s share.
Top 10 Shareholders (Pre-IPO, Fully Diluted Basis)
| Rank | Shareholder | No. of Equity Shares | % Holding (Pre-IPO) |
|---|---|---|---|
| 1 | Tata Sons | 3,57,50,64,262 | 88.6% |
| 2 | TMF Holdings | 18,62,24,770 | 4.6% |
| 3 | Tata Investment Corp. | 8,29,36,767 | 2.1% |
| 4 | International Finance Corporation (IFC) | 7,16,48,559 | 1.8% |
| 5 | TCL Employee Welfare Trust | 2,83,48,896 | 0.7% |
| 6 | Firoz Cyrus Mistry | 1,39,34,456 | 0.3% |
| 7 | Shapoorji Pallonji Mistry | 1,39,34,456 | 0.3% |
| 8 | Rajiv Sabharwal (MD & CEO) | 66,62,400 | 0.2% |
| 9 | Tata Motors | 43,26,651 | 0.1% |
| 10 | Tata Chemicals | 32,30,859 | 0.1% |
- Promoter control: Tata Sons commands ~89% ownership.
- Minor institutional presence: IFC owns just 1.8%, and is partly exiting via OFS.
- Group cross-holdings: Tata Investment Corp., Tata Motors, and Tata Chemicals hold small stakes.
- Management skin in the game: CEO Rajiv Sabharwal personally holds 66 lakh shares.
Post-IPO, promoter shareholding will dilute but Tata Sons will retain majority control, ensuring strategic stability.
Financial Performance
Tata Capital has delivered strong growth over the last three years, though margins have compressed slightly as the scale has expanded.
| Particulars | FY23 | FY24 | FY25 | Q1 FY26 |
|---|---|---|---|---|
| Revenue | 13,628.9 | 18,174.8 | 28,312.7 | 7,664.8 |
| Expenses | 9,847.6 | 13,794.8 | 23,448.7 | 6,308.9 |
| Net Profit | 3,029.2 | 3,150.2 | 3,664.7 | 989.9 |
| Net Margin (%) | 22.2% | 17.3% | 12.9% | 12.9% |
| EPS (INR) | 8.4 | 8.6 | 9.3 | 2.5* |
| ROE (%) | 20.6 | 15.5 | 12.6 | 12.5 |
| ROA (%) | 2.9 | 2.3 | 1.8 | 1.8 |
📌 Key Insights
- Revenue CAGR: ~45% over FY23–FY25.
- Profit growth: From INR 3,029 Cr (FY23) to INR 3,665 Cr (FY25).
- Q1FY26 boost: Profit jumped 114% YoY, showing strong operating momentum.
- Margins under pressure: Net margin fell from 22% in FY23 to ~13% in FY25–Q1FY26.
- Returns moderating: ROE declined from ~21% to ~12–13% as the equity base expanded.
Key Performance Indicators (KPIs)
Some KPIs are crucial for evaluating NBFCs — especially loan growth, margins, cost efficiency, and asset quality.
- Disbursements: INR 74,766.7 Cr (FY23) → INR 1,42,301.7 Cr (FY25) → INR 3,47,143 Cr (Q1FY26)
- Loan Book: INR 1,20,196.9 Cr (FY23) → INR 2,26,553.0 Cr (FY25) → INR 2,33,398.6 Cr (Q1FY26)
- Loan Mix (FY25): Retail ~62%, SME ~26%, Corporate ~11%
- Secured Loans: ~79–80% of book
Profitability & Efficiency
- NIM: 5.0–5.2% (stable)
- NIM + Fee Income Margin: ~6.0–6.4%
- Cost-to-Income Ratio: 42% (FY25) → 36.8% (Q1FY26, improved)
- ROE: 12.6% (FY25)
- ROA: 1.8% (FY25)
Asset Quality
- Gross Stage 3 Loans: 1.7% (FY23) → 1.9% (FY25) → 2.1% (Q1FY26)
- Net Stage 3 Loans: 0.4% (FY23) → 0.8% (FY25) → 1.0% (Q1FY26)
- Provision Coverage Ratio (PCR): 77% (FY23) → 58.5% (FY25) → 53.9% (Q1FY26)
📌 Key Insights
- Rapid loan growth at 35–40% YoY.
- Margins stable despite rising cost of funds.
- Warning flag: NPAs inching higher, while PCR is falling — signaling pressure on asset quality.
Subsidiary Performance – Tata Motors Finance (TMFL)
While Tata Capital consolidated looks strong, its vehicle finance arm (TMFL) shows stress.
- FY25 Disbursements: Declined by 5.5% YoY.
- Profitability: Reported a loss of INR 180 Cr in FY25 vs a profit of INR 52 Cr in FY24.
- Asset Quality: Gross Stage 3 loans rose to 7.1% in FY25 vs 6.1% a year earlier.
- ROE: Turned negative at -4.1% in FY25.
TMFL acts as a drag on Tata Capital’s otherwise strong consolidated numbers. Its weakness in the commercial vehicle financing space highlights sector-specific risks that investors should track.
Tata Capital IPO: Key Strengths and Risks
| Strengths | Risks/Concerns |
|---|---|
| Strong Parentage: Backed by Tata Sons (156-year-old Tata Group), ensuring credibility and market trust. | Rising NPAs: Gross Stage 3 loans rose to 2.1% (Q1FY26) from 1.7% (FY23), while PCR declined to ~54%. |
| Scale & Reach: 1,516 branches across 27 states & UTs, serving 7.3 million customers. | Subsidiary Weakness: TMFL posted losses (INR 180 Cr in FY25) with high NPAs (7.1%). |
| High Growth Trajectory: Loan book CAGR of 37.3% between FY23–FY25; disbursements growing at 35–40% annually. | Margin Pressure: Net margins declined from 22% (FY23) to ~13% (FY25), due to higher finance costs. |
| Diversified Loan Portfolio: Retail (62%), SME (26%), Corporate (11%), reducing concentration risk. | Moderating Returns: ROE fell from 20.6% (FY23) to 12.6% (FY25). |
| Capital Augmentation: Fresh issue fully allocated to Tier I capital — strengthens growth capacity & regulatory compliance. | Competitive Industry: Intense rivalry with Bajaj Finance, Shriram Finance, HDFC, etc. |
Tata Capital offers growth + brand comfort, but investors must weigh it against asset quality deterioration and weaker subsidiary performance.
Tata Capital IPO Timeline & Key Dates
| Event | Date |
|---|---|
| IPO Opening Date | 6 October 2025 |
| IPO Closing Date | 8 October 2025 |
| Allotment Finalization | 9 October 2025 |
| Refunds Initiated | 10 October 2025 |
| Demat Credit of Shares | 10 October 2025 |
| Listing Date (NSE, BSE) | 13 October 2025 |
Final Outlook
The Tata Capital IPO is shaping up to be one of the biggest financial services listings of the decade. It combines the trust of the Tata brand, a rapidly expanding loan book, and the comfort of capital infusion for growth. With a well-established presence across retail, SME, and corporate lending, supported by both digital and physical networks, Tata Capital is well-positioned for future expansion. The fresh capital infusion is focused on strengthening its Tier I base, ensuring regulatory compliance and enabling long-term growth. Overall, the IPO showcases scale, credibility, and robust potential in the NBFC landscape.
For more details related to IPO GMP, SEBI IPO Approval, and Live Subscription stay tuned to IPO Central.