Tata Capital IPO price band set at steep discount to unlisted market

Tata Capital Sets IPO Price Band at Rs 310–326, Nearly 55% Below Unlisted Market Price.

Expert Analysis:

• IPO Price Band: Tata Capital has set its IPO price band at Rs 310–326 per share, significantly lower than its July 2025 rights issue price of Rs 343 and nearly 55 percent below its prevailing unlisted market price of Rs 735.

• Unlisted Market Trends: Shares once quoted at Rs 1,075 in June 2025 have slipped 32 percent, while April 2025’s peak of Rs 1,125 implies nearly 70 percent erosion to the IPO band.

• IPO Listing Risks: Tata Capital’s unlisted shares have fallen 30–36 percent since April, reflecting broader trends where nearly 30 percent of Indian IPOs between 2023–2025 listed below issue price, including NSDL’s 35 percent listing-day plunge.

• Valuations vs Peers: Unlisted valuations at 8.5–11x price-to-book exceeded Bajaj Finance (5.9x) and Shriram Finance (4x). Current IPO pricing reduces inflated grey market premiums.

• Business Strengths: Tata Capital’s Rs 2.37 lakh crore AUM, 88 percent retail and SME loan mix, and 28–37 percent CAGR show long-term growth potential. However, a high P/E of 113x and modest 12 percent ROE limit near-term upside.

• IPO Structure and Size: At the upper band, the fresh issue totals Rs 6,846 crore, with an offer for sale of Rs 8,665.87 crore. The anchor book will be Rs 4,642 crore, valuing Tata Capital at Rs 1.38 lakh crore.