Tata Capital IPO: Company Seeks Valuation Of Up To $20 Billion
Tata Capital aims to raise about $2.2 billion in its IPO, which is expected to launch in the first half of September.
Tata Capital Ltd. is seeking a valuation of $18 billion to $20 billion in its planned initial public offering and could file an updated draft red herring prospectus as soon as this week, people familiar with the matter said.
The valuation is much higher than an earlier target of about $11 billion, with the Tata Group unit buoyed by a recent rights issue and the success of other IPOs in India, including by fellow shadow lender, HDB Financial Services Ltd., the people said. HDB attracted strong demand and raised about $1.5 billion.
Tata Capital aims to raise about $2.2 billion in its IPO, which is expected to launch in the first half of September, the people said, asking not to be identified discussing confidential information.
Representatives for Tata Capital and parent Tata Sons Pvt. didn’t respond to requests for comment.
At that valuation, Tata Capital would rank as India’s fourth-biggest shadow bank. Bajaj Finance Ltd. has a market value of about $69 billion, followed by Bajaj Finserv Ltd. and Jio Financial Services Ltd. at $38 billion and $23 billion, respectively.
HDB is valued at about $7.7 billion following its debut earlier this month, having rallied almost 14% on its first day of trading.
Enthusiasm around India’s equity markets is picking up again, with other big listings in the pipeline, including the local unit of LG Electronics Inc., which is looking to raise as much as $1.7 billion. Kotak Mahindra Capital Co. expects more than $30 billion to be raised in Indian IPOs over the next 12 months, an executive from the bank said in an interview with Bloomberg News this week.
Tata Capital initially filed confidential IPO papers in April and received approval from India’s market regulator last month to proceed. Companies are then required to submit an updated draft red herring prospectus and allow time for public feedback before filing a final version.
The Reserve Bank of India has issued guidelines requiring larger shadow banks including Tata Capital to list by the end of September.
