On Tuesday, Tata Investment Corporation experienced a remarkable surge in its stock price, soaring over 10% to reach an intraday peak of Rs 6,344 per share. This impressive rally can be attributed to the recent announcement that Tata Capital, a subsidiary in which Tata Investment holds a significant stake, has received the green light for its long-anticipated Initial Public Offering (IPO).

Tata Investment’s Stock Dynamics

Currently, Tata Investment’s shares are trading at Rs 6,206.75, reflecting an 8% increase. The company’s market capitalization is now approximately Rs 31,390 crore. Over the past week, the stock has gained nearly 9%, while the monthly growth stands at around 5%. However, it’s worth noting that the stock has experienced a 13% decline over the past year, indicating some volatility.

Insights into Tata Capital’s Upcoming IPO

Tata Capital, a non-banking financial company (NBFC) within the Tata Sons conglomerate, has received approval from its board for the public offering. This IPO will consist of a fresh issue of 23 crore equity shares, alongside an offer for sale from select existing shareholders.

Currently, Tata Sons holds a substantial 93% stake in Tata Capital, while Tata Investments possesses over 2% of the company.

Key points regarding Tata Capital’s IPO:

• Funds Utilization: According to the Draft Red Herring Prospectus (DRHP) filed with the Securities and Exchange Board of India (SEBI), the funds raised will be directed towards expanding lending and investment operations, settling existing debts, and supporting business activities, including capital expenditures and working capital.

A Look at Recent Tata Group IPOs

The forthcoming IPO of Tata Capital is set to be the second public offering from a Tata Group company in nearly 20 years. The last notable IPO was that of Tata Technologies, which made its debut on November 30, 2023.

Tata Technologies, a subsidiary of Tata Motors, had an exceptional listing, debuting at a staggering 140% premium over its issue price of Rs 500. The stock opened at Rs 1,199.95 on the BSE and Rs 1,200 on the NSE, establishing itself as one of the standout IPOs in recent memory.

As the market anticipates Tata Capital’s IPO, investors are keenly observing whether it will replicate the stellar performance of its predecessor, setting the stage for another successful listing in the Tata Group’s portfolio.