Tata Capital's plan will file IPO documents after approval of merger of Tata Motors Finance

Financial services company Tata Capital is expected to file initial IPO papers following the National Company Law Tribunal (NCLT) approval of the merger of Tata Motors Finance. Giving details of the issue, the sources mentioned that the firm awaits the final order of NCLT for the same. The size of the IPO will be around two billion dollars or Rs 17,000 crore.

The firm's valuation is estimated by the sources to be around $ 11 billion in terms of size. The final order is likely to come from NCLT, which could arrive by the end of the current fiscal. The firm hasn't received a response to the mail that was sent to the draft documents.

Tata Capital has been recognized as an upper-level non-banking financial company (NBFC) by the Reserve Bank of India (RBI). The company has already received the board of directors' approval for the IPO. The company will issue 2.3 crore new shares as part of the IPO. Apart from this, an offer for sale by a few current shareholders will also be initiated.

Apart from the IPO, Tata Capital has also announced plans to raise funds through a rights issue to further strengthen its financial position ahead of public listing. If the public issue is successful, it will be one of the largest public issues in the country's financial sector. This will be the second public issue of the Tata Group in recent years after the listing of Tata Technologies in November 2023. The move is part of an effort to meet the listing requirements of the Reserve Bank of India (RBI).

As per the RBI order, an upper-level NBFC is required to be listed on the stock exchanges within three years of getting this recognition. Tata Capital was classified as a top-tier NBFC in September 2022. Apart from Tata Capital, another top-tier NBFC, HDB Financial Services, owned by HDFC Bank, is also preparing to launch an IPO.