Tata Capital’s highly anticipated initial public offering (IPO) is set to be one of the biggest events in India’s financial landscape for 2025. As the financial services arm of the Tata Group, Tata Capital commands significant interest from institutional and retail investors alike. This blog post provides a well-researched, comprehensive, and SEO-optimized overview of everything you need to know about the Tata Capital IPO, including its details, financials, strategic context, risks, and potential opportunities.
1. Tata Capital IPO Overview & Key Details
What is the Tata Capital IPO?
- Tata Capital is launching an IPO estimated at ₹17,200 crore, comprising both a fresh issue of shares and an offer for sale (OFS) by existing shareholders, primarily Tata Sons and the International Finance Corporation (IFC).
- The IPO is expected to open in September 2025, with a listing deadline of September 2025, in line with Reserve Bank of India (RBI) mandates for “upper-layer” non-banking financial companies (NBFCs).
IPO Structure and Valuation
- Issue Size: ₹17,200 crore (Fresh Issue plus OFS)
- Expected Price: Around ₹450-₹550/share for the IPO, notably lower than the unlisted market, which touched ₹1,100/share in 2024.
- Estimated Valuation: Targeting $18–20 billion (~₹1.48–1.65 lakh crore) at listing.
It’s worth noting that TATA Capital Limited Unlisted Share has been actively traded in the grey market over the past year, offering a strong preview of investor appetite and premium valuation ahead of the public issue.
2. Business Model, Financial Performance & Peer Analysis
Tata Capital’s Business Model
- Operates as a diversified NBFC: retail & SME lending (housing, auto, personal loans), corporate finance, investment banking, and sustainable finance
- Backed by Tata Sons (92.8% ownership pre-IPO) and enjoys AAA credit ratings from major agencies.
- As of FY25, Tata Capital’s consolidated assets under management (AUM) are approximately ₹2.2 lakh crore, ranking it among India’s top 3 NBFCs
- The company’s network covers over 723 branches nationwide
Sustainability Push: A Green Energy Giant in the Making
Tata Capital has been aligning its long-term lending strategy with India’s climate goals by actively financing clean energy projects and ESG-compliant businesses. This growing focus on sustainable and infrastructure finance has positioned the company as a green energy giant in the making, particularly through its green bonds, EV financing, and renewable sector exposure.
Financial Highlights (FY23–FY25)
| Metric | FY23 | FY24 | FY25 Estimate |
| Revenue | ₹18,178 crore | N/A | ₹28,370 crore |
| Profit After Tax (PAT) | ₹2,300 crore | ₹3,150 crore | N/A |
| Asset Base | ₹1,35,626 crore | ₹1,76,694 crore | ₹2,21,950 crore |
| Loan Book CAGR | 35% YoY | N/A | N/A |
| Gross NPA | 1.71% | N/A | N/A |
Lucrative market position but relatively high price-to-earnings (P/E) and price-to-book (P/B) multiples compared to benchmarked peers like Bajaj Finance and Piramal Finance and L&T Finance.
Peer Comparison Table
| Company | P/E | P/B | ROE (%) | Market Cap (₹ Cr) |
| Tata Capital | 41x* | 10.16x | 10.63 | 3,81,000 |
| Bajaj Finance | 34.6x | 5.93x | 19.2 | 5,78,000 |
| L&T Finance | 19.5x | 2.03x | 10.8 | 51,608 |
*Assuming IPO pricing at ₹400/share and sustained FY25 earnings[1].
3. Strategic Rationale, Growth Prospects & Risks
Why Is Tata Capital Going Public?
- RBI regulatory compliance requires “Upper Layer” NBFCs (like Tata Capital) to be listed within three years of classification—by September 2025.
- IPO proceeds will:
- Strengthen capital adequacy and funding capabilities. Finance business expansion across retail, SME, and green/infra lending.
- Broaden public shareholding, aiding future market and governance objectives
Industry Trends & Growth Potential
- India’s financial sector is expected to see 15–17% CAGR in NBFC growth between FY24–FY27, driven by consumer credit and MSME lending demand.
- Government programs supporting MSME and retail credit provide additional tailwinds for Tata Capital’s market strategy.
Risks and Challenges
- Potential overvaluation: Even at ₹400/share, multiples remain well above sector averages, which may impact post-listing performance.
- Exposure to macroeconomic swings (interest rates, inflation, liquidity, regulatory changes) could increase borrower defaults and NPA ratios.
- Heightened competition from other well-capitalized NBFCs and banks may compress margins over time.
Conclusion
The Tata Capital IPO marks a historic moment both for the Tata Group and India’s NBFC sector. Combining strong parentage, robust financial growth, and market leadership, Tata Capital is primed for its listing debut in July–September 2025. Investors should weigh the company’s proven track record and growth prospects against valuation risks and market volatility. Ultimately, the IPO offers a unique opportunity to participate in the next phase of India’s financial services evolution, but as with any major public offering, careful due diligence is warranted before making investment decisions.