Tata Capital’s $2 Billion IPO: A Landmark in India’s Financial Sector | Rits Capital by Rits capital - HTML preview

TATA CAPITAL

Tata Capital, the financial services arm of the iconic Tata Group, is

gearing up to launch one of the most significant initial public

offerings (IPOs) in India in 2025. With a targeted issue size of $2

billion (approximately 17,000 crore), this IPO marks a pivotal ₹

milestone both for Tata Capital and the broader non-banking

financial company (NBFC) sector. It not only represents a

regulatory milestone but also reflects Tata Capital’s impressive

growth trajectory and strategic positioning in areas such as clean

technology finance.

Background: From Tata Cleantech

Capital to Tata Capital

The International Finance Corporation (IFC), part of the World Bank Group, partnered with Tata Capital in 2011 to establish Tata Cleantech Capital Ltd (TCCL). This initiative was designed to foster financing for renewable energy and sustainable infrastructure projects at a time when India’s clean technology sector faced considerable challenges related to subsidies and investment risk.

Over the past decade, TCCL

matured into one of India’s leading green financiers, supporting over 500 renewable projects spanning solar, wind, biomass, small hydro, water treatment, and electric

By fiscal year 2025, Tata Cleantech’s loan book crossed 18,000 ₹

crore, reflecting a compound annual growth rate (CAGR) near 32%

over the prior two years, making a significant contribution to Tata

Capital’s business and growth profile.

In a strategic consolidation, TCCL merged with Tata Capital, integrating cleantech finance with Tata Capital’s broader NBFC operations. This merger has created a powerful financial institution with diversified lending capabilities and a robust green finance portfolio.

Tata Capital’s Financial Performance

and Market Position

The International Finance Corporation (IFC), part of the World

Bank Group, partnered with Tata Capital in 2011 to establish Tata

Cleantech Capital Ltd (TCCL). This initiative was designed to

foster financing for renewable energy and sustainable

infrastructure projects at a time when India’s clean technology

sector faced considerable challenges related to subsidies and

investment risk.

Its diversified lending portfolio

includes consumer loans, commercial

finance, private equity, loans against

property, and wealth management

services, along with a deep focus on

sustaining and expanding its cleantech

finance vertical.

Tata Capital’s total assets grew robustly, from 1.35 lakh crore in ₹ 2023 to 1.76 lakh crore in 2024, exemplifying strong balance ₹

sheet growth and capital adequacy.

International Finance Corporation’s

Multibagger Returns

A noteworthy highlight in the IPO narrative is the lucrative early

investment by IFC in Tata Capital. IFC initially entered at an

adjusted equity price of about 25 per share back in 2011, ₹

investing approximately 179 crore. Following the merger and ₹

subsequent equity actions including a rights issue priced at 343 ₹

per share in July 2025, IFC’s 7.16 crore-share holding is now

valued at nearly 2,458 crore. ₹

IFC plans to sell 3.58 crore shares

in the upcoming IPO, which would

realize a notional gain of about

₹ 2,278 crore—an approximate 13-

fold multiple on the original

investment. Market sources

anticipate that the IPO pricing

could be even higher than the

rights issue price, potentially

delivering greater returns to IFC

and other shareholders alike.