Tata Capital Share Price LIVE Updates: Tata Group stock falls over 1% a day after listing. Should you buy?

“Tata Capital, a leading NBFC, enjoys a diversified presence across retail and corporate lending, wealth management, and other financial services. The company’s fundamentals remain sound with steady growth and strong parentage, but valuations were seen as fair, leaving limited room for listing-day excitement. Going ahead, investors may consider booking partial profits near listing levels while holding some shares for the long term, as the company’s growth prospects remain attractive in India’s expanding financial services sector. A stop-loss around ₹300 is advisable to protect downside risk in the near term,” said Shivani Nyati, Head of Wealth at Swastika Investmart Ltd.

Tata Capital has a highly diversified product mix, offering 25+ distinct lending products broadly classified into three businesses: 61% of its loan book comprising retail finance, 26% SME and 13% corporate loans. With the highest credit rating of AAA/Stable, Tata Capital enjoys easy access to funds at lower interest rates. However, higher share of secured loans and greater competition from banks in Tata Capital’s segments lead to lower-than-peers NIMs of ~5-5.5% which along with lower credit cost, gets translated into RoA of ~2.1-2.5% (in FY23/FY24).

Among large diversified NBFCs, Tata Capital has quietly built one of the more balanced franchises—combining steady growth with a conservative risk approach and strong parent backing. While players like Bajaj Finance and Chola have grown faster in niche segments, Tata Capital’s progress has been broad-based and measured.

Nearly 80% of its portfolio is secured, which gives it stability and keeps credit costs low even as it scales up in retail and SME lending. The recent merger with Tata Motors Finance diversifies its product offering in vehicle finance and deepens its reach across semi-urban and rural markets, while its AAArated balance sheet and backing from Tata Sons provide a clear edge in funding flexibility.

Operating costs remain slightly elevated as the company invests in its ~1,500 branch network and digital infrastructure, though these are steps toward long-term upscaling. Compared with peers, Tata Capital may not yet be the most profitable; however, its strong foundation, governance, and diversified growth model make it one of the most dependable and competitive franchises in the NBFC space.

"Per our estimate, Tata Capital would log ~24% AUM CAGR over FY25-28; with operating leverage at play and improving credit cost on the back of turnaround in the vehicle finance business, we expect a strong ~30% FY25-28E EPS CAGR. However, RoA/RoE will remain moderate, reaching ~2.2%/15.4% by FY28E. The moderate return profile limits the scope of a re-rating over the near-to-medium term; stock returns will largely be led by BV compounding.

We initiate coverage on Tata Capital with ADD and Sep-26E target price of ₹360 (10% upside), implying 2.8x FY27E P/B. Key risks: Delay in credit cost reduction in vehicle finance; worsening macroeconomic factors impeding growth and asset quality," said the brokerage.

“At IPO upper price band of INR 326, current expected valuation multiple of TCL is ~2.7x FY27E P/BV. Based on its AUM growth and RoE profile, TCL should trade between CIFC and HDB, which have valuation multiple of 3.7x and 2.5x FY27E P/BV, respectively. We assign TCL a target multiple of 2.9x FY27E BVPS reflecting a ~10%-12% premium/discount to HDB Financial/CIFC. Downside risks: economic slowdown leading to AUM growth slowdown, delayed NIM expansion, higher credit cost and regulatory risk,” said JM Financial Institutional Securities.

1. Strong parentage of Tata Group and strong brand value
2. One of the largest diversified portfolio mix
3. Strong growth aided by cross-sell and wide presence
4. TMFL-merger – a mixed view
5. Operationally strong
6. Moderate asset quality metrics

Prashanth Tapse, Senior Vice President of Research – Research Analyst at Mehta Equities Ltd, indicated that for investors who have been allotted shares, it is advisable to HOLD them for the long term due to the company's inherent strengths and potential for growth, while also recognizing the short-term market risks involved. For investors who have not been allotted shares, it is recommended to take a ‘Wait and Watch’ stance—observe the stock following its listing and consider buying if there is a significant price decrease.

Tata Capital share price today opened at ₹330.15 apiece on the BSE, the stock touched an intraday high of ₹331.95 per share, and an intraday low of ₹330.15 per share.

On the NSE, Tata Capital share price opened at ₹330.50 apiece, and the stock touched an intraday high of ₹331.90 per share, and an intraday low of ₹330.05 apiece.

The initial public offering of Tata Capital Ltd, a non-banking financial company, was fully subscribed by the end of the bidding process on October 8.

The company's share sale, valued at ₹15,512 crore, attracted bids for 65,12,29,590 shares, compared to the 33,34,36,996 shares available, resulting in a subscription rate of 1.95 times, as per NSE data.

Every investor category saw complete subscription for the public offering. Tata Capital's IPO stands as the largest issuance of the year.

The allocation for Qualified Institutional Buyers (QIBs) was subscribed 3.42 times, while the segment aimed at non-institutional investors saw a subscription of 1.98 times. The Retail Individual Investors (RIIs) category experienced a subscription rate of 1.10 times.

The Initial Public Offering (IPO) offered a total of 47.58 crore shares, which included a fresh issuance of 21 crore equity shares and an Offer For Sale (OFS) of 26.58 crore shares.

The funds raised from the Tata Capital IPO will be utilized to enhance the company's Tier-1 capital base, aiding in future capital needs, including further lending.

This event represented Tata Group's second public listing in recent years, following the launch of Tata Technologies in November 2023.

Tata Capital IPO was conducted in accordance with the Reserve Bank of India's (RBI) listing requirement for upper-layer non-banking financial companies (NBFCs), mandating them to go public within three years of their classification.

Tata Capital was classified as an upper-layer NBFC in September 2022.

Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decision.