Introduction

Tata Capital is set to become the latest Tata Group company to hit the stock market. With SEBI’s approval process nearly complete, India is bracing for one of its biggest IPOs in the financial services space—valued at nearly $2 billion (₹17,200 crore). This public offering holds not only regulatory importance but also market-shaping potential.

In this article, we explore the Tata Capital IPO news, financials, expected price band, and caution for unlisted market investors.

A) Tata Capital IPO: Regulatory Green Signal Soon

As per reports, the Securities and Exchange Board of India (SEBI) has concluded its review of Tata Capital’s draft red herring prospectus (DRHP). The final observation letter, which signals regulatory clearance, is expected shortly. This would enable the Tata Group’s NBFC arm to go public ahead of the September 2025 deadline imposed by the RBI.

Why the Rush?

Tata Capital is part of the RBI’s ‘Upper Layer’ of NBFCs, which mandates public listing for greater transparency and compliance. This IPO will help Tata Capital align with that directive.

B) Tata Investment Shares React Strongly

Following the IPO news, Tata Investment Corporation shares surged 8%, hitting ₹7,150 on June 6. This surge reflects growing investor optimism that the IPO will unlock substantial value, not only for Tata Capital shareholders but across the Tata ecosystem.

C) IPO Structure: Fresh Issue + OFS

The IPO is expected to feature a dual structure:

• 🔄 Fresh Issue – To raise growth capital.

• 🔁 Offer for Sale (OFS) – Providing partial exit to existing shareholders.

This combination will help Tata Capital bolster its balance sheet while giving early investors a profitable exit.

D) Tata Capital Financial Highlights (FY25)

While Tata Capital reported strong top-line growth, a sharp increase in expenses and rising NPAs point to potential operational challenges.

🚨 Caution for Unlisted Investors

Expected IPO Price Band: ₹350–₹400 per share

Current Unlisted Market Price: ₹1,000 per share

⚠️ This means the unlisted shares are trading at nearly 2.5x the expected IPO price.

🔍 Investor Advisory

• There’s a valuation mismatch.

• No listing gain is likely if bought at current unlisted prices.

• Hype around the IPO is driving short-term demand in the grey market.

Investors must carefully assess whether to enter at inflated valuations or wait for listing.

🔚 Conclusion

The Tata Capital IPO is a landmark move in India’s NBFC sector and could unlock significant value for the Tata Group. However, investors in the unlisted market must proceed with caution given the steep premium currently demanded.

With FY25 financials showing growth but also early signs of stress in asset quality, prudent evaluation is key before taking positions in the pre-IPO market.

Stay updated with all IPO news and pre-IPO research at UnlistedZone