The much talked about IPO from the Tata Group company -Tata Capital is set to open soon and ahead of that the company has raised Rs 4,642 crore from anchor investors. Themuch-awaited initial public offering (IPO) opens on October 6. The anchor book witnessed demand nearly five times higher than the shares on offer, signalling strong investor appetite.
According to a circular uploaded on the BSE website, Tata Capital allotted 14.24 crore shares at Rs 326 per share to 68 institutional investors.
LIC, ICICI Pru MF, Goldman Sachs among key investors
The anchor round saw participation from some of the biggest domestic and global investors. These include the Life Insurance Corporation of India (LIC), ICICI Prudential Mutual Fund, Nippon India Mutual Fund, Motilal Oswal Mutual Fund, Amansa Holdings, Nomura, Morgan Stanley, Government Pension Fund Global and Goldman Sachs.
“Due to strong demand, investors did not get the kind of stake they were looking to have in the company and had to be satisfied with limited subscription,” market sources said.
The Life Insurance Corporation of India emerged as the single largest anchor investor, receiving 2.15 crore shares worth nearly Rs 7,000 crore. LIC’s allocation made up more than 15% of the total anchor portion.
Tata Capital seeks to raise Rs 15,512 crore through IPO
The company’s Rs 15,512 crore IPO will open for subscription from October 6 and bidding will close on October 8. The issue price band is fixed between Rs 310-326 per share. At the upper end, Tata Capital will command a valuation of around Rs 1.38 lakh crore.
The public offering includes a fresh issue of 21 crore shares worth Rs 6,846 crore and an offer for sale of 26.58 crore shares worth Rs 8,666 crore. Tata Sons will offload 23 crore shares, while the International Finance Corporation (IFC) will sell 3.58 crore shares. Currently, Tata Sons holds 88.6 per cent stake in Tata Capital and IFC owns 1.8 per cent.
Funds to boost Tier-1 capital and lending capacity
Proceeds from the fresh issue will be used to strengthen Tata Capital’s Tier-1 capital base and support future business requirements.
This IPO also helps the company meet the Reserve Bank of India’s mandate that requires “upper layer” NBFCs to list within three years of classification. Tata Capital was placed in this category in September 2022.