Tata Capital IPO: CEO Rajiv Sabharwal Says RBI Norms Accelerated Market Entry

Tata Capital Ltd. is gearing up for Rs 15,511 crore through its upcoming initial public offering. The company recently announced its price band for the IPO at Rs 310-326 per share. The IPO is scheduled to open for subscription on Dalal Street on Oct. 6 and close on Oct. 8.

In an exclusive interview with NDTV Profit, Rajiv Sabharwal, Managing Director and CEO of Tata Capital, said that the company has been consistently getting strong capital support from Tata Sons for its growth. However, he pointed out that the regulatory framework introduced by the Reserve Bank of India in September 2022 regarding the NBFC Upper Layer classification was a key trigger for the IPO.

He said, "If this regulatory change hadn’t happened, we might not have been in the market at this point, maybe some point later," Sabharwal said.

On the IPO pricing, Sabharwal explained that the process was driven by investor feedback and market analysis. "We meet investors, take their feedback, our investment bankers, their teams look at what is there in the market, and based on all their feedback, the board decides what needs to be done, and on that basis, the current ipo price was decided."

Addressing market expectations, Sabharwal emphasised Tata Capital’s long-term vision. "We are very focused on building a company which will last for generations, and our approach there is to create a business model which will grow at high pace and deliver one of the lowest credit cost," he said.

Sabharwal highlighted that Tata Capital has posted a growth rate of 28% over the last three years, and the credit cost has been below 1%, before the merger with Tata Motors Finance.

He credited this growth to company’s diversified product portfolio across consumer, housing, SME, and corporate lending, noting that consumer housing and SME segments together account for nearly 90% of the total asset book.

"Each product is of scale and has a strong growth engine. This allows us to moderate growth across segments, capture India’s growth opportunity optimally, and keep credit costs low," he added.