Tata Capital Ltd. is aiming to raise up to 155 billion rupees ($1.7 billion) in what is poised to be India’s largest initial public offering (IPO) so far this year, according to Bloomberg reporting.
The financial-services company, along with shareholders Tata Sons Pvt. and the International Finance Corporation, plans to offer up to 475.8 million shares at a price band of 310 to 326 rupees per share. At the top end of this range, Tata Capital would be valued at approximately $16 billion.
The IPO is expected to rekindle investor interest in India’s share sales, following a slow start to the year, and is set to be the country’s largest offering since Hyundai Motor India Ltd. raised $3.3 billion last year. Orders for anchor investors begin Friday, while the broader public can subscribe from October 6 to October 8. Trading is expected to start on October 13.
Tata Capital operates nearly 1,500 branches as of March and provides loans to both individuals and businesses. The company plans to use the IPO proceeds to bolster its tier-1 capital base to meet future regulatory requirements, according to an August filing.
The Reserve Bank of India had instructed large non-bank financiers, including Tata Capital, to list by the end of September to improve transparency and reduce sector risks. Tata Capital requested a short extension to better prepare for the offering, according to sources familiar with the matter.
For the fiscal year ending March, Tata Capital reported a profit of 36.6 billion rupees, a 16% increase from the prior year, with gross loans totaling 2.27 trillion rupees.
The IPO is being managed by a consortium of leading investment banks, including Kotak Mahindra Capital, Axis Capital, BNP Paribas, Citigroup Global Markets India, HDFC Bank, HSBC Securities and Capital Markets (India), ICICI Securities, IIFL Capital, J.P. Morgan India, and SBI Capital Markets.
