Tata Capital made a lackluster market debut on Monday, listing at a premium of just 1.23% on the benchmark indices.

Shares of the non-banking financial company listed at ₹330 on both the NSE and the BSE. The stock's issue price was ₹326 per share. It was India's biggest IPO so far this year.

At the time of writing, the stock was trading at ₹326.50 on the NSE and ₹327 on the BSE.

IPO Details

Tata Capital saw a strong demand for its ₹15,511.87 crore initial public offering (IPO). The shares were allotted to investors on October 9.

According to BSE data, the Tata Capital IPO was subscribed 1.95 times overall at the close of its three-day bidding window. Investors bid for 65.12 crore shares against the 33.34 crore shares available. The firm said it plans to use the proceeds primarily to strengthen its capital base and support future lending operations.

Among investor categories, Qualified Institutional Buyers (QIBs) led the demand, subscribing 3.42 times the reserved portion, with bids for 32.44 crore shares against 9.49 crore on offer. Non-Institutional Investors (NIIs) followed with a 1.98x subscription, while retail investors booked 1.10x their quota, subscribing to 18.21 crore shares versus 16.61 crore available.

Brokerages Views

Brokerages have been largely positive. JM Financial and Emkay Global have both initiated coverage on Tata Capital with an“Add” rating and a target price of ₹360 per share, implying an upside potential of around 10% over the IPO price of ₹326.

JM Financial highlighted Tata Capital's strong credit profile, noting its AAA rating and stable outlook, which enable access to funds at lower borrowing costs. The brokerage expects the company's AUM to grow at a 20% CAGR and net profit at a 34% CAGR between FY25 and FY27. However, it cautioned that at the upper end of the IPO band, valuations appear stretched at 2.7x price-to-book, limiting near-term upside.

Emkay Global echoed a similar view, citing Tata Group's strong backing, a well-diversified loan portfolio, and operational efficiencies as key drivers for long-term profitability.

SEBI-registered analyst Vishal Trehan noted that Tata Capital traded at a modest premium to its peers, Shriram Finance and HDB Financial, but at a discount to Bajaj Finance. The robust institutional interest was indicative of their confidence in its long-term scalability. 

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