Tata Capital begins taking orders for 155 billion rupees IPO, India’s largest this year

[MUMBAI] Tata Capital started taking orders on Monday (Oct 6) for an initial public offering that may raise as much as 155 billion rupees (S$2.3 billion), India’s biggest listing this year, and putting the country’s hot IPO market on course for a record month.

The shadow lender’s shares, which are expected to start trading on Oct 13, are being sold at 310 rupees to 326 rupees apiece until Wednesday, valuing the company at as high as 1.4 trillion rupees. That would value the Tata Group unit at more than twice the market capitalisation of HDB Financial Services, which went public earlier this year.

Tata’s offering will be followed by LG Electronics’ Indian unit in another billion-US dollar IPO launch the next day, a sign that confidence is growing about investor demand being able to absorb large issuances despite the headwinds faced by the local stock market. All in all, Indian IPO proceeds could climb to a record in October, exceeding US$5 billion.

“There is now ample capacity to absorb supply,” said Raghuram K, a partner at Uniqus Consultech. Mutual funds are awash with money flowing in through monthly investment plans, giving them the confidence to keep deploying capital, he said.

As for Tata’s offering, it will involve the sale of as many as 475.8 million new and existing shares by Tata Capital, its parent, and International Finance, according to the IPO prospectus. The IPO got bids for 9 per cent of the shares offered at 10.30 am in Mumbai, data from the BSE show.

On Friday, the company said it raised 46.4 billion rupees by selling shares to anchor investors including funds managed by Morgan Stanley, Goldman Sachs Group and Nomura Holdings Life Insurance, India’s biggest insurer, was among the key subscribers to the company’s shares.

For investors, the Tata Capital deal offers exposure to the financial services arm of one of India’s largest and most-reputed conglomerates, and is set to be the nation’s biggest IPO since Hyundai Motor India’s record US$3.3 billion offering last year.

The company, incorporated in 2007, offers a range of financial products and services to retail, corporate and institutional clients. Its assets under management stood at 2.33 trillion rupees as of June 2025, catering to 73 million customers.

Tata Capital looks attractive because the company offers a resilient business model with a focus on sustained growth, supported by a diversified asset mix, ICICI Direct Research wrote in a note to clients.

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At the upper end of their marketed range, Tata Capital shares could still be attractive at 3.4 times book value, according to SBI Securities. That would make it cheaper than peers including Bajaj Finance, Cholamandalam Investment and Finance and HDB Financial, according to data compiled by Bloomberg.

More broadly, the IPO rush has been powered by rising corporate ambitions in one of the world’s fastest-growing major economies, a strong pool of domestic capital and a seemingly insatiable appetite for new listings among millions of retail investors with rising incomes.

Companies have been able to raise money even as India’s stock market has lost momentum in 2025 after an unprecedented nine-year rally, weighed down by concerns over a slowdown in earnings growth as well as US-India tensions.

With 2025 proceeds at US$11.2 billion as the third quarter ended, India emerged as the world’s fourth-busiest IPO market this year based on fundraising volume, according to data compiled by Bloomberg. That follows last year’s record tally of US$21 billion.

JPMorgan Chase, JM Financial and Kotak Mahindra Capital are among those who have predicted the boom to continue, with regulatory changes also adding to the optimism.

India’s securities regulator last month tweaked norms to make it easier for very large private firms to go public, while the central bank recently relaxed rules on loans to investors participating in IPOs. BLOOMBERG