logo
Tata Capital rights issue pricing raises valuation to ₹1.38 trillion

Tata Capital rights issue pricing raises valuation to ₹1.38 trillion

Tata Sons, the holding company of the Tata group, participated in its financial services arm Tata Capital's rights issue last week at ₹343 per share — a 22 per cent premium to the earlier rights issue price of ₹281 per share in March.
This latest investment has raised initial public offering (IPO)-bound Tata Capital's valuation by 31 per cent to ₹1.38 trillion, up from ₹1.05 trillion in March, according to company filings with stock exchanges. Last week, Tata Capital allotted additional equity shares of ₹10 each, aggregating ₹1,752 crore, on rights issue basis, the company said.
With the rights issue, the paid-up equity share capital of the company rose from ₹3,983.79 crore to ₹4,034.87 crore, the company said. After this, the valuation of Tata Sons, which holds 93 per cent stake, went up from ₹98,175 crore to ₹1.28 trillion.
Tata Capital is planning to come out with an IPO by September to raise up to $2 billion (₹17,259 crore). The IPO pricing for the company will be decided prior to the issue, depending upon the investors' response and market conditions, say bankers.
Proceeds from Tata Capital's listing are expected to bolster Tata Sons' war chest as it ramps up investments in emerging sectors such as semiconductor manufacturing, and electronics.
In 2023-24 (FY24), Tata Sons' standalone operating income rose 25 per cent to ₹43,767 crore, with nearly 95 per cent coming from TCS (Tata Consultancy Services) dividend, and buyback flows. For FY25, dividend receipts from TCS are expected to fall to ₹32,722 crore from ₹34,053 crore.
Meanwhile, Tata Sons — now debt-free and tagged as upper-layer non-banking financial company (NBFC) — has sought to exit the Reserve Bank of India's (RBI's) NBFC-UL framework and has filed for reclassification, people said. The application is pending with the RBI.
As of March 2025, Tata Capital reported a consolidated tangible net worth of ₹32,892 crore, up from ₹24,069 crore the previous year, supported by a ₹1,500 crore capital infusion from Tata Sons during FY25. Consolidated gearing improved slightly to 6.04x from 6.16x, Care Ratings said in May this year. As of September 2024, Tata Capital maintained a healthy capital structure, with a tangible net worth of ₹25,480 crore, and gearing of 6.35x. The company's standalone capital adequacy ratio (CAR) stood at 16.91 per cent, well above the regulatory threshold, the rating firm said. It added that Tata Capital's capital structure continues to benefit from the strong backing of the Tata group, which provides both financial flexibility, and a demonstrated track record of capital support. The rating firm said it expects Tata Capital's gearing to remain within the 6.0x-6.5x range over the medium term.
Orange background

Try Our AI Features

Explore what Daily8 AI can do for you:

Comments

No comments yet...

Related Articles

Top stocks to buy today: Stock recommendations for July 28, 2025
Top stocks to buy today: Stock recommendations for July 28, 2025

Time of India

time2 hours ago

  • Time of India

Top stocks to buy today: Stock recommendations for July 28, 2025

JP Morgan downgraded Bajaj Finance to neutral from overweight with the target price of Rs 970. Analysts feel the NBFC remains the best in quality among peers with the rare combination of high growth and quality. Yet, a pick-up in mortgage attrition, weakness in MSMEs and the continued weakness in some parts of the loan quality suggest possibility of negative revisions of the NBFC's estimates. Morgan Stanley maintained its overweight rating on SBI Life Insurance with the target price at Rs 2,115. Analysts said the company's April-June quarterly numbers showed a good performance by the life insurer. They believe the company is a preferred large cap stock with an attractive risk-reward profile. The stock has limited downside across most large caps in non-bank financials space. Macquarie maintained its neutral rating on Nestle but cut target price to Rs 2,250 from Rs 2,375. Analysts said that the company's April-June numbers missed estimates and they see near term growth headwinds for it. According to analysts the company missed to meet its gross margin estimates and higher other expenses offset largely inline sales. Commentary suggests milk and nutrition sales are yet to recover. They see benign coffee prices hurting pricing growth in beverages going forward. Investec upgraded Torrent Pharma to buy from sell and hiked target price to Rs 4,100 from Rs 2,930. Analysts feel the company is doubling up to multi-faceted opportunities. They feel Torrent Pharma's recent acquisition of JB Chemicals & Pharmaceuticals strengthens its position in chronic, probiotics and GI spaces in India. They expect this acquisition to be EPS accretive by FY28. Axis Capital maintained a reduce rating on Canara Bank with the target price at Rs 110. Analysts feel that the bank's net interest margin (NIM) would continue to remain under pressure in FY26. During the past quarter, the lender's CASA (current account, savings account) CASA ratio dipped, loan growth was driven by retail and MSMEs while its fee income was stable. They said prolonged NIM and ROA (return on assets) decay can keep valuations at risk. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now

Rs 140 crore in perks: Tata Sons Chairman N Chandrasekaran's FY25 pay package totals over Rs 155 crore
Rs 140 crore in perks: Tata Sons Chairman N Chandrasekaran's FY25 pay package totals over Rs 155 crore

Indian Express

time12 hours ago

  • Indian Express

Rs 140 crore in perks: Tata Sons Chairman N Chandrasekaran's FY25 pay package totals over Rs 155 crore

Tata Sons Chairman N Chandrasekaran Salary: Tata Sons Chairman N Chandrasekaran is among the highest-paid industry leaders in India. In its annual report, the principal investment holding firm of the Tata Group of companies, said that the N Chandrasekaran's total remuneration in FY25 was at Rs 155.81 crore, up 15 per cent from Rs 135.32 crore in FY24. This huge pay package includes Rs 15.12 crore in salary and other compensation, along with Rs 140.69 crore as commission on profits for the financial year 2024-25. According to details available, Chandrasekaran joined the Board of Tata Sons in October 2016 and was appointed Chairman in 2017. Before becoming the Chairman, he served as the Chief Executive Officer and Managing Director of Tata Consultancy Services (TCS), the country's largest IT services firm. The IT giant is set to lay off about 2 per cent of its workforce (around 12,200 employees) in the financial year 2025-26. The move is likely to impact primarily employees at the middle and senior management levels. According to Reuters, the Tata Group company is retraining and redeploying staff as it enters new markets, invests in new technology and deploys AI, but over 12,000 jobs will be cut as part of the process. 'This transition is being planned with due care to ensure there is no impact on service delivery to our clients,' the company said, reports Reuters. Earlier this month, during earnings conference call, Milind Lakkad, Executive Vice President and Chief Human Resources Officer (CHRO) at TCS said that the workforce at the end of the first quarter was 6,13,069. 'Net attrition during the quarter was over 5,000 employees. We have honored all the job offers, and we'll do so for the rest of the year. Lateral hiring will be recalibrated based on the demand outlook,' he said, as per the exchange filing.

Poonawalla Fincorp aims AUM growth upwards of 40% in FY26, says CEO
Poonawalla Fincorp aims AUM growth upwards of 40% in FY26, says CEO

Business Standard

time19 hours ago

  • Business Standard

Poonawalla Fincorp aims AUM growth upwards of 40% in FY26, says CEO

Financial Services firm Poonawalla Fincorp is targeting above 40 per cent growth in its asset book on the back of expansion in products portfolio including gold loans. "We have given Asset Under Management growth guidance of 35-40 per cent this year. We hope to exceed our target as new product lines are gaining good traction," Poonawalla Fincorp MD and CEO Arvind Kapil told PTI. Poonawalla Fincorp registered a 53 per cent robust growth on annual basis in AUM at Rs 41,273 crore at the end of first quarter ended June 30, 2025. "We have close to 13 businesses and there are two noteworthy items that we have and we gave a declaration that we will be building AUM for the first four quarters and we will look at a guidance of sustained business profits thereafter which is a little different than how NBFC's have normally built," he said. The company's offerings include pre-owned car finance, personal loans, loans for professionals, business loans, loans against property, machinery loans, education loans, commercial vehicle loans, shopkeeper loans, gold loans, and consumer durable loans. In a bid to grow the business, he said, the promoter will soon infuse Rs 1,500 crore via the issuance of equity shares on a preferential basis for which board approval is already in place. "This strategic move underscores the promoter's continued confidence in the company's long-term growth trajectory and will further strengthen the capital base to support its business growth," he said, adding, a Rs 1,500 crore growth capital by promoter - among the largest in recent times - will push net worth of the company to approx Rs 10,000 crore. The proposed capital infusion would sustain high growth for this financial year and the NBFC would look at another round of equity raise may be early next financial year, he said. As far as the gold loan business is concerned, he said, it was launched in April and since then the company has opened 80 branches dedicated to this business across Gujarat, Haryana, Rajasthan and Maharashtra. Another 320 branches would be opened in the span of 7-8 months to take total branches to 400 by year end, he added. Other two businesses launched in April this year -- shopkeeper loan and consumer durable loan, while commercial vehicle loan and education loan introduced in March are also getting good response, he said. In all, the Cyrus Poonawalla group promoted non-deposit taking systemically important non-banking finance company (ND-SI-NBFC) launched 5 products in 2025. As regards commercial vehicle loan, he said the company has commenced business across 27 locations in 10 states and completed on-boarding of 200 plus distribution partners while on the education loan side there will be a network to over 500 education consultants by March 2026 apart from a dedicated sales team. Talking about cost borrowing, he said, it has come down to 8.04 per cent during the first quarter as against 8.07 per cent in the March quarter. The credit cost is 1.43 per cent, among the best in the industry and fund raise is well diversified. During Q1FY26, the Pune-based NBFC raised Rs 5,458 crore through NCD (including sub-debt) to increase the proportion of long-term borrowings. This has increased NCD contribution to about 24 per cent of total borrowings against about 7 per cent as on March 2025. As far as asset acquisitions are concerned, he said, the priority would be on the secured lending business. (Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

DOWNLOAD THE APP

Get Started Now: Download the App

Ready to dive into a world of global content with local flavor? Download Daily8 app today from your preferred app store and start exploring.
app-storeplay-store