Tata Capital IPO subscription to begin on Monday: Should you subscribe? 10 key things to know

Tata Capital IPO subscription begins October 6. 

The primary market is set for a busy week as two major companies, Tata Capital and LG Electronics India, gear up to launch their initial public offerings (IPOs), collectively worth more than Rs 26,000 crore. The twin issues are expected to draw strong investor interest, given their scale and the stature of their parent groups.

This will mark Tata Group's second public listing in recent years, following the debut of Tata Technologies in November 2023.

Here are the key details you need to know before you subscribe to the non-banking financial company Tata Capital:

1) Anchor investors: The company collected Rs 4,642 crore from 68 domestic and global institutional investors, with the anchor book witnessing demand nearly five times higher than the allocated amount.

2) Issue size: The total issue size of the IPO is Rs 15,512-crore.

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3) Issue dates: Tata Capital IPO will open for subscription during October 6-8.

4) Price band: The price range is fixed at Rs 310 to Rs 326 per share.

5) Objective: Proceeds from the IPO will be used to strengthen the company's Tier-1 capital base, supporting future capital requirements, including onward lending.

6) Key financials: For the financial year 2024-25, Tata Capital reported a profit after tax (PAT) of Rs 3,655 crore, up from Rs 3,327 crore in FY24. Its revenue also witnessed a sharp increase to Rs 28,313 crore in FY25 from Rs 18,175 crore in the previous fiscal.

7) IPO GMP: According to platforms tracking the grey market activities, the shares of the company are commanding a GMP of about 2 percent in the unregulated market. Investorgain quoted a GMP of Rs 8 for the shares of the company, indicating a listing gain of 2.45 percent.

8) Allotment Date: Shares of the company are likely to be allotted by Thursday, October 9.

9) Listing date: Share listing is scheduled to take place on both BSE and NSE on Monday, October 13.

10) Should you subscribe?

The analysts at the SBI Securities recommended key highlights, including strong parentage of Tata Group, diversified product offerings, omni-channel distribution model, prudent risk culture leading to stable asset quality and high credit rating with a diverse liability profile.

On its growth strategies, the company said, the company continues on the current growth trajectory by enhancing product offerings and strengthening the distribution network. The company maintains credit rating and a diversified liability mix to optimise borrowing costs, while continuing to attract and retain top talent.

The analysts also highlighted key risks, including, asset quality risk, exposure to unsecured loans, loan concentration and liquidity risk.

Disclaimer: The views and investment tips expressed by experts on Moneycontrol are their own and not those of the website or its management. Moneycontrol advises users to check with certified experts before taking any investment decisions.