Tata Capital’s Rs 15,500-crore IPO entered its second day of bidding on Tuesday, having drawn an overall subscription of 0.39 times on day one. The initial public offering -- the largest since Hyundai Motor India’s 2024 listing -- has attracted strong institutional interest. But brokerages caution that beneath the group’s brand comfort lie tightening margins, elevated funding costs and thinner provisioning cover that could curb near-term profitability.

TMFL merger weighs down on Tata Capital’s profitability; provisioning cushion shrinks

The integration of Tata Motors Finance Ltd (TMFL) has added scale and wider vehicle financing to Tata Capital’s portfolio; but it has also introduced higher-cost liabilities and moderate-quality assets, requiring larger provisions and pushing up the blend

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