Tata Capital Limited – IPO Reviews 2025, Analysis and Notes

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Key Highlights

Company Background:

Tata Capital Limited (“TCL”) is among India’s leading diversified NBFCs. Incorporated in 2007, it has built a strong presence across retail, MSME, and corporate segments, serving 7.3 million customers as of June 30, 2025. Categorized as an “Upper Layer” NBFC by the RBI, the company offers a comprehensive portfolio of over 25 lending products, including retail loans, SME financing, corporate credit, and vehicle finance. It also distributes insurance and credit cards, provides wealth management, and manages private equity funds. With total gross loans of ₹2.33 trillion as of June 2025, Tata Capital ranks as India’s third-largest diversified NBFC, combining growth, scale, and robust asset quality.

Market Opportunity:

The Indian NBFC sector has emerged as a vital pillar of the credit ecosystem, complementing banks by addressing underserved retail, MSME, and rural segments. The industry’s assets under management grew from ₹23 trillion in FY2019 to ₹48 trillion in FY2025, recording a CAGR of 13.2%. Going forward, NBFC credit is projected to expand at 15–17% CAGR between FY2025 and FY2028, driven by rising retail consumption, MSME financing, and housing demand. With 21% share of systemic credit in FY2025, NBFCs continue gaining ground through flexible lending, strong origination, and faster turnaround than banks. Technology adoption, deeper rural penetration, and digital lending platforms present significant opportunities, positioning NBFCs as key enablers of financial inclusion and credit growth.

Diversified and Scalable Business Model:

TCL benefits from a diversified and scalable business model, allowing it to cater to a wide spectrum of customers across retail, MSME, and corporate segments. Its portfolio includes over 25 lending products, alongside insurance distribution, wealth management, and private equity fund offerings, creating multiple revenue streams. As of June 30, 2025, the company manages gross loans of ₹2.33 trillion, making it India’s third-largest diversified NBFC. Leveraging the trusted Tata brand, an extensive distribution network, and robust digital platforms, Tata Capital strengthens customer acquisition and retention. This diversified scale provides resilience, growth visibility, and a competitive edge in a rapidly expanding financial services market.

Omni-Channel Distribution Model:

TCL’s omni-channel distribution model significantly strengthens its ability to deliver financial services at scale. As of June 30, 2025, the company had a pan-India presence through 1,516 branches across 1,109 locations in 27 States and UTs, ensuring strong physical reach. This extensive branch footprint is complemented by over 30,000 direct selling agents (DSAs), more than 400 OEMs, 8,000+ dealers, and over 60 digital sourcing partners. Such a diverse distribution ecosystem—combining physical presence with strong partner networks and digital platforms—enhances accessibility, customer acquisition, and cross-selling opportunities. By leveraging this integrated model, Tata Capital ensures wide penetration, efficient delivery, and scalability, thereby reinforcing its competitive positioning in India’s financial services landscape.

Financials:

For FY25, TCL posted interest income of ₹25,720 crore, up from ₹16,366 crore in FY24. The net profit for FY25 was ₹3,655 crore, up from ₹3,327 crore in FY24. For FY25, Return on Equity (ROE) stood at 12.6% and Return on Assets (ROA) at 1.8%. On the valuation front, at the upper price band of ₹326, the IPO is valued at 3.4x P/BV based on post-issue capital.

Key Risks:

TCL faces risks from changes in its loan mix, which could impact financial metrics and asset quality. Adverse developments reducing retail loan demand or increasing defaults may hurt business performance. Earnings are also exposed to interest rate volatility in lending and treasury operations. Operating in a regulated and competitive financial services industry, failure to comply with regulations or compete effectively could negatively affect results.

Issue Highlights

Offer Structure

Lead Book Running Managers

• Kotak Mahindra Capital Co. Ltd

• BNP Paribas

• Citigroup Global Markets India Pvt. Ltd

• HDFC Bank Ltd

• HSBC Securities & Capital Markets (India) Pvt. Ltd

• ICICI Securities Ltd

• IIFL Capital Services Ltd

• JP Morgan India Pvt. Ltd

• SBI Capital Markets Ltd

• Axis Capital Ltd

Registrar to the Offer

MUFG Intime India Pvt. Ltd

Research Analyst

Vinay Kalani
vinay.kalani1@religare.com

Research Team

Ajit Mishra – ajit.mishra@religare.com
Abhijeet Banerjee – abhijeet.banerjee@religare.com
Gaurav Sharma – gauravsharma2@religare.com
Ashwani Harit – ashwani.harit@religare.com
Divya Parmar – divya.parmar@religare.com
Vinay Kalani – vinay.kalani1@religare.com
Rajan Gupta – rajan.gupta1@religare.com

• Author: Religare Broking
• Last Updated: October 6, 2025