TATACAP - Tata Capital

📊 NSE: TATACAP 🏢 Non Banking Financial Company (NBFC) 📅 Last Updated: 11/13/2025 15:25

💰 Financial Performance

Revenue Growth by Segment

Consolidated Total Income (net of interest) grew 54.6% YoY to INR 13,340 Cr in FY25 from INR 8,630 Cr in FY24. Standalone AUM for the core lending business grew 22% YoY to USD 24bn in Q2 FY26 (excluding Motor Finance).

Geographic Revenue Split

Not disclosed in available documents. The company operates through 1,479 branches across India as of September 2025.

Profitability Margins

Consolidated Profit After Tax (PAT) grew 9.8% to INR 3,655 Cr in FY25. Return on Average Assets (RoA) was 1.7% in FY25, compared to 2.1% in FY24. Return on Average Equity (daily average) was 12.6% in FY25.

EBITDA Margin

Pre-provisioning operating profit (PPOP) was USD 861mn in FY25. Cost to income ratio stood at 41.6% in FY25, increasing from 38.3% in H1 FY25 due to the merger with Tata Motors Finance.

Capital Expenditure

Cumulative capital infusion from Tata Sons reached USD 1,417mn by H1 FY26. Shareholders infused INR 1,600 Cr in March 2025 to support growth plans.

Credit Rating & Borrowing

Domestic credit rating is AAA/Stable by CRISIL, ICRA, and CARE. International ratings include BBB (S&P) and BBB- (Fitch). Borrowing mix as of Dec 2024: NCDs (39%), Term Loans (36%), ECBs (10%), and Commercial Paper (6%).

⚙️ Operational Drivers

Raw Materials

Capital and Debt (Cost of Funds) represent the primary input cost for the financial services business.

Import Sources

External Commercial Borrowings (ECB) represent 10% of the borrowing mix, sourced from international markets.

Key Suppliers

Lenders include a diverse base of banks and institutional investors in Non-Convertible Debentures (NCDs).

Capacity Expansion

Current physical network consists of 1,479 branches as of September 2025. The company is expanding through a 'Phygital' model combining digital capabilities with physical expansion.

Raw Material Costs

Finance costs were USD 1,708mn in FY25. The company leverages its Tata Group association to mobilize debt at competitive costs.

Manufacturing Efficiency

Operating expenses as a percentage of average net loan book were 2.6% in FY25. Cost to income ratio was 36.8% in Q2 FY25.

Logistics & Distribution

Distribution of mutual funds, insurance, and credit cards is managed through 100% owned subsidiary Tata Securities Ltd.

📈 Strategic Growth

Expected Growth Rate

22%

Growth Strategy

Growth will be achieved through the integration of Tata Motors Finance (effective May 2025), leveraging the Tata ecosystem (70+ group companies), and focusing on Retail and SME segments which already form 88% of the book. The company is also scaling its Wealth Management business (USD 829mn AUM, 26% CAGR) and Private Equity (USD 887mn raised).

Products & Services

Retail loans, SME finance, housing finance, commercial vehicle financing, wealth management, private equity funds, and distribution of insurance and mutual funds.

Brand Portfolio

Tata Capital, Tata Securities, Tata Capital Housing Finance (TCHFL).

New Products/Services

Expansion into captive financing for Tata Motors and deeper penetration into the 7.7mn+ existing customer base with insurance and credit card cross-selling.

Market Expansion

Targeting pan-India growth through 1,479 branches and digital platforms to capture the 'India opportunity'.

Market Share & Ranking

Amongst the largest diversified NBFCs in India. Tata AIA Life has ~10% market share; Tata AIG General Insurance has ~5.8% market share.

Strategic Alliances

Merger with Tata Motors Finance Limited (TMFL) completed in May 2025 to unlock captive financing synergies.

🌍 External Factors

Industry Trends

The NBFC sector is evolving with tighter 'Upper Layer' regulations. Tata Capital is positioned as an Upper Layer NBFC with a focus on digitalization and physical expansion to capture credit demand in Retail and SME sectors growing at 20%+ YoY.

Competitive Landscape

Competes with large private banks and other systemically important NBFCs in the retail, SME, and housing finance segments.

Competitive Moat

Sustainable moat derived from the 'Tata' brand name, 78.8% ownership by Tata Sons, and deep integration with the Tata ecosystem providing access to 1,000+ dealers and 70+ group companies for captive lending.

Macro Economic Sensitivity

Highly sensitive to Indian GDP growth and domestic consumption trends, as the group focus is on domestic consumption as a key growth theme.

Consumer Behavior

Shift toward digital lending and phygital service models in the Indian financial services market.

Geopolitical Risks

Minimal direct impact as operations are primarily domestic, though international ratings (BBB/BBB-) are influenced by India's sovereign rating.

⚖️ Regulatory & Governance

Industry Regulations

Regulated as a Systemically Important Non-Deposit taking Core Investment Company (CIC) and an Upper Layer NBFC by the Reserve Bank of India (RBI).

Taxation Policy Impact

Effective tax rate is consistent with Indian corporate tax norms; PAT of INR 3,655 Cr is reported after tax provisions.

⚠️ Risk Analysis

Key Uncertainties

Integration risk of Tata Motors Finance (TMFL) which has a weaker asset quality profile (GSIII rose to 2.3% standalone post-merger). Potential for sharp deterioration in asset quality if Gross NPA exceeds 6%.