Question 1

Tata Capital — Financial / Valuation Snapshot (Past Few Years)

Metric / Year
FY 2023
FY 2024
FY 2025
Notes / Source & Caveats

Total Income / Revenue (₹ Crores)
13,631 (Screener)
18,178 (Screener)
28,324 – 28,370 (Unlisted Zone)

Net Profit (PAT, ₹ Crores)
2,946 (Screener)
3,327 (Screener)
3,655 (Unlisted Zone)

EPS (₹)
—
—
≈ 9.72 (Unlisted Zone)

ROE (Return on Equity)
—
≈ 20.7 % (FY 24) (Tata Capital)
≈ 10.63 % (FY 25) (Unlisted Zone)

Gross NPA
—
≈ 1.71 % (FY 24) (Unlisted Zone)
≈ 2.33 % (FY 25) (Unlisted Zone)

Net NPA
—
≈ 0.38 % (FY 24) (Unlisted Zone)
≈ 0.98 % (FY 25) (Unlisted Zone)

Unlisted / Pre-IPO P/E (approx)
—
—
≈ 100 – 120× (various sources)

Unlisted / Pre-IPO P/B (approx)
—
—
≈ 8 – 12× (various sources)

Notes & Caveats:
Since Tata Capital is not yet listed, the P/E and P/B ratios come from unlisted-share markets and should be treated cautiously.
Some sources report unlisted P/E of ~104.3× (Unlisted Zone), ~108.78× (Sharescart), or ~111.5× (Altius Investech).
High P/B multiples (8–12×) are also reported (Planify).
The ROE for FY 24 (~20.7 %) is from Tata Capital’s own financials. Growth in FY 25 figures reflects rapid lending expansion and provisions.

Comparative Performance of Recent Financial IPOs

Accepted Answer

Recent financial sector IPOs in India have shown mixed returns, with many underperforming benchmarks. For instance, the HDFC Bank subsidiary IPO in 2023 saw initial enthusiasm fade within months, highlighting volatility.

Question 2

Assessing Debt and Asset Quality

Accepted Answer

Tata Capital's debt-to-equity ratio is currently in alignment with industry averages, reflecting a balanced approach to leveraging its financial resources. However, the landscape of rising interest rates poses a significant challenge that could potentially strain the company's profitability.

Question 3

Allocation Inequalities and Lock-in Periods

Accepted Answer

Data from recent IPOs show that retail quotas are frequently oversubscribed, leading to lottery-style distributions. For example, the LIC IPO saw retail allotment rates below 10% in many cases.

Question 4

Market Timing and Economic Indicators

Accepted Answer

Launching an IPO during market peaks often precedes corrections, as seen in the 2021 tech IPO frenzy. Current indices near all-time highs suggest potential overvaluation.

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