Tata Capital to launch $2B IPO in early October after RBI approval

Tata Capital Ltd., the financial services arm of the Tata Group, is gearing up for one of India’s largest initial public offerings (IPOs) in recent years. After securing approval from the Reserve Bank of India (RBI) for a short extension, the company is now expected to launch its IPO in the first half of October 2025. With an estimated fundraising target of up to ₹17,000 crore ($1.9–2 billion), this listing could become the biggest Indian IPO since Hyundai Motor India Ltd.’s record $3.3 billion debut in 2024.

RBI’s Push for Transparency in Shadow Financing

The RBI has instructed large non-banking financial companies (NBFCs), including Tata Capital, to list on stock exchanges to improve sector transparency and reduce systemic risks. The central bank initially set a deadline for September-end 2025. However, Tata Capital sought a brief extension to fine-tune its offering plans and ensure robust investor participation. The RBI granted approval, clearing the way for an October launch.

Roadshows and Prospectus Filing

According to people familiar with the matter, Tata Capital could conclude its IPO roadshows by the end of this week. The company is also expected to file a revised Draft Red Herring Prospectus (DRHP) with updated details soon. These steps are critical as Tata Capital positions itself for what could be one of the most closely watched public issues of the year.

Size and Valuation of the IPO

Tata Capital aims to raise as much as ₹17,000 crore (approximately $1.9 billion) through the offering. The IPO is expected to value the company at around $18 billion, reflecting strong investor confidence in both the Tata brand and the financial services sector. This scale would place the IPO among India’s top capital market events in recent years.

Market Impact of the IPO News

News of Tata Capital’s IPO plans has already had a ripple effect on related stocks. Tata Investment Corporation, a key shareholder in Tata Capital, saw its shares surge by as much as 3.2% in Mumbai trading, marking its biggest intraday gain since August 5. Market watchers say this is a reflection of investor optimism about Tata Capital’s growth trajectory and the broader Tata Group’s credibility.

Why This IPO Matters for India’s Financial Sector

Tata Capital’s upcoming listing is more than just a fundraising event. It represents a milestone in India’s efforts to enhance governance in the shadow banking sector. By bringing NBFCs like Tata Capital into the public domain, the RBI hopes to foster greater accountability, attract long-term investments, and ensure stability in financial markets.

Additionally, the IPO is expected to deepen India’s capital markets by offering investors access to one of the country’s most significant non-banking lenders. Analysts believe the public listing will also set benchmarks for other NBFCs required to comply with RBI’s listing mandate.

Tata Group’s Strategic Financial Growth

For the Tata Group, this IPO underscores its continued strategy of strengthening its financial services arm. Tata Capital has built a reputation for consumer lending, wealth management, and corporate financing, making it a diversified player in India’s financial landscape. The IPO proceeds will likely be used to fuel expansion, strengthen the balance sheet, and capitalize on India’s growing demand for credit and investment services.

Outlook Ahead

With the RBI’s approval in place, Tata Capital is now focused on completing regulatory filings and preparing for a strong market debut in October. Investor appetite for large IPOs in India remains robust, particularly in the financial services and technology sectors. If successful, Tata Capital’s IPO will not only cement its leadership among NBFCs but also reinforce India’s status as one of the world’s most dynamic IPO markets.

Conclusion

Tata Capital’s nearly $2 billion IPO, launching in October 2025, is shaping up to be a landmark event for India’s financial sector. Backed by the Tata Group’s legacy, RBI’s regulatory push, and strong investor demand, the listing is expected to attract significant global attention. As the countdown begins, all eyes will be on Tata Capital’s roadshows and final IPO pricing.