Synopsis:
Recently listed Tata Capital is in focus after JM Financial made its commentary, highlighting a 10 percent upside from its current level, citing that despite strong growth and financial stability, its high valuation at the IPO limits significant upside for investors in the near term.
The shares of this leading capital services provider of the Tata group are in focus after JM Financial gave key comments on it following its listing. In this article, we will dive more into the details.
With a market capitalization of Rs 1,38,571 crore, the shares of Tata Capital Ltd made their debut on the stock exchange on 13 October 2025, opening at Rs 330 per share, just 1.23 percent above its upper price band of Rs 326 per share.
Analyst Comments
JM Financial has initiated coverage and recommended “Add” Tata Capital and has set a price target of Rs 326 per share, signalling an upside potential of 10 percent from its current market price.
According to JM Financial, Tata Capital can very comfortably borrow funds at low rates because it has the highest credit rating of AAA with a stable outlook. They anticipate that the company’s Assets Under Management (AUM) will grow at a CAGR of 20 percent and its net profit will grow at a 34 percent CAGR from FY25 to FY27.
Tata Capital’s IPO was 1.98 times subscribed in total, with the majority of subscriptions coming from institutions, while the retail portion was only fully subscribed. However, JM Financial pointed out that, taking the upper price band into account, the stock will be priced at 2.7 times the forecasted price-to-book for FY27, which indicates a limited upside potential.
Also Read: Smallcap stock in focus after receiving ₹24 Cr order from Helmier for construction project
Financial Highlights
The company reported a revenue of Rs 28,324 crore in FY25, up by 56 percent from its FY24 revenue of Rs 18,178 crore. Regarding its profitability, the company reported a net profit growth of 10 percent to Rs 3,655 crore as compared to Rs 3,327 crore in FY24.
The stock delivered a poor ROE and ROCE of 13.95 percent and 9.68 percent respectively, and is currently trading at a high P/E of 37.85x as compared to its sector P/E of 49x.
Tata Capital Limited (“TCL”) is the flagship financial services company of the Tata Group, which is a subsidiary of Tata Sons Private Limited and is carrying on business as a non-banking financial company (NBFC).
Tata Capital and its subsidiaries are engaged in providing/supplying a wide array of services/products in the financial services sector and operate across various areas of business: Commercial Finance, Consumer Loans, Wealth Services , and the distribution and marketing of Tata Cards.
Written by Satyajeet Mukherjee
Disclaimer
The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Trade Brains Technologies Private Limited or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
