Tata Group’s financial arm, Tata Capital, has confidentially submitted its draft documents to the Securities and Exchange Board of India (Sebi) for an upcoming Initial Public Offering (IPO). This strategic move, following Sebi’s confidential filing route, allows Tata Capital to initiate its public listing process while keeping key business information away from competitors and public scrutiny.
According to reports, Tata Capital's IPO will comprise both a fresh issue and an offer for sale. The board has already approved a fresh issue of up to 230 million equity shares. Additionally, existing shareholders—including parent company Tata Sons and the International Finance Corporation (IFC)—plan to dilute part of their holdings through the offer for sale.
Despite the planned stake reduction, Tata Sons is expected to maintain a dominant ownership, with reports indicating its stake will remain above 75% after the IPO.
Tata Capital has roped in ten investment banks to guide the IPO process. These include:
Kotak Mahindra Capital
Citi
JP Morgan
Axis Capital
ICICI Securities
HSBC Securities
IIFL Capital
BNP Paribas
SBI Capital
HDFC Bank
The diverse advisor pool reflects the scale and ambition of Tata Capital’s public market debut.
As of March 31, 2024, Tata Sons directly held a 92.83% stake in Tata Capital. The rest was held by IFC and other Tata Group companies. Tata Sons has shown consistent financial support for Tata Capital, subscribing to a ₹1,504 crore rights issue in February 2024 and infusing ₹6,097 crore into the company over the past five years.
Tata Capital is registered as a systemically important, non-deposit-taking Core Investment Company with the Reserve Bank of India (RBI). The company operates in both wholesale and retail finance sectors, offering a broad suite of financial products.
The company’s Assets Under Management (AUM) have shown significant growth:
FY22: ₹94,349 crore
FY23: ₹119,950 crore
FY24: ₹158,479 crore
This upward trend underscores Tata Capital’s expanding presence in India’s financial services market.
Tata Capital has become the eighth notable Indian company to choose Sebi’s confidential pre-filing mechanism. Other firms that have opted for this route include Tata Play, Swiggy, Oyo, Vishal Mega Mart, Indira IVF, PhysicsWallah, and Credila Financial Services.
Introduced in November 2022, the confidential filing route allows companies to submit the Draft Red Herring Prospectus (DRHP) privately. If the company decides to proceed with the IPO post-Sebi feedback, the DRHP is made public at least 21 days before the Red Herring Prospectus (RHP) filing.
This process minimizes premature market speculation and protects proprietary business details, offering greater flexibility to firms contemplating a public listing.