Mumbai: Tata Sons will dilute its stake in Tata Capital by nearly 10 percentage points through an IPO that combines a fresh issue and an offer for sale. The offering, comprising a total of 47.6 crore shares, includes a fresh issue of 21 crore shares and an offer for sale of 26.6 crore shares. Tata Sons will offload 23 crore shares, while International Finance Corporation (IFC) will sell 3.6 crore shares.According to market sources, the issue size is likely to be around Rs 17,200 crore. Following the IPO, Tata Sons’ holding in Tata Capital will fall from 88.6% to approximately 78.8%, although it will retain a controlling stake of over 75%. The IPO is being launched in compliance with RBI’s rules that mandate listing for upper-layer non-bank lenders. Tata Capital, currently categorised as such, had three years to list following its classification.The fresh issue will expand the company’s equity base to 4.24 billion shares from the current 4.03 billion. Tata Capital will use the proceeds from the new issue to support growth and strengthen its balance sheet.As of March 31, 2025, the company had total assets of Rs 24.85 lakh crore, up sharply from Rs 13.56 lakh crore in FY23. Total borrowings stood at Rs 20.84 lakh crore, while equity capital was Rs 3.32 lakh crore. Its gross loan book reached Rs 22.66 lakh crore, having grown at a CAGR of 37.3% over the last two fiscal years.Tata Capital, which merged with Tata Motors Finance, is seeking to deepen its reach across lending segments. It serves 7 million customers through a network of 1,496 branches in 1,102 locations and employs nearly 30,000 people. The company also works with over 30,000 direct selling agents, 400 OEMs and 8,000 dealers. Its mobile apps have been downloaded more than 21 million times.Tata Capital’s future plans according to the draft papers include expanding its product suite, strengthening digital distribution, improving risk management, and maintaining its credit ratings. It also aims to optimise funding costs and invest in analytics and technology to boost efficiency and customer experience. The company holds a valid NBFC licence and a factoring registration from the RBI. The draft papers make no mention of any plan to convert into a bank.
