Tata Capital IPO: India’s Biggest Public Issue in the Financial Sector?

Whenever the name Tata Group comes up, it evokes trust and large-scale business. Continuing this legacy, Tata Capital is now gearing up for its mega IPO. The market is already buzzing, as this could turn out to be the country’s largest public issue in the financial sector.

How big will this IPO be?
The IPO is expected to open in the week starting 22nd September, with an estimated size of ₹17,200 crore. Market experts believe this could value the company at nearly $11 billion. If everything goes as planned, Tata Capital will be listed on the stock exchange by 30th September.

How will the shares be allocated?
According to the Draft Red Herring Prospectus (DRHP) filed in August, the IPO will comprise around 47.58 crore shares. Of these, 21 crore shares will be fresh issues, while the remaining 26.58 crore shares will be sold through an Offer for Sale (OFS).

Who is selling how many shares?
Under the OFS, Tata Sons will offload 23 crore shares, while the International Finance Corporation (IFC) will sell about 3.58 crore shares. Currently, Tata Sons holds 88.6% in Tata Capital, while IFC owns 1.8%.

Where will the IPO proceeds be used?
The company plans to use the funds to strengthen its Tier-1 capital base and meet future business requirements. This includes reducing debt and supporting new growth initiatives.

If successful, this IPO could become the largest public issue in India’s financial sector. Previously, in November 2023, Tata Group launched the Tata Technologies IPO, and this will be the group’s second major offering.

Investor excitement is already high around Tata Capital’s mega IPO. The big question now is: how big an impact will it create when it opens?