5 Tata Group Companies Likely To Launch IPOs

Building on the momentum and record-breaking fundraising shown in 2024, the Indian initial public offerings (IPO) market is anticipated to maintain its robust expansion into 2025. Experts predict a rise in activity, fueled by demand from overseas portfolio investors, local inflows, and retail involvement. The IPO market is anticipated to provide investors with a variety of options as several businesses prepare to go public.

A record number of IPOs with premium pricing were listed in 2024, making it an attractive year for traders, investors, and enthusiasts of IPOs. These IPOs seek to profit from expanding industries such as online shopping and electric automobiles, which are propelled by development ambitions and regulatory constraints. India’s IPO market saw up to 327 IPO listings in 2024.

It is anticipated that a number of Tata Group firms would go public in the upcoming years. Tata Technologies’ 2023 IPO, the Tata Group’s first in almost 20 years, has raised investor interest in Tata Group businesses. Tata Technologies Ltd. made its debut in November 2023; it floated at a premium of Rs. 1400, with a listing gain of about 140%. This made the IPO the biggest listing gain in 2023 and the largest in the previous two years.

With more than 100 active companies, the Tata Group operates in a number of industries, including engineering, communications, information technology (IT), minerals, automobiles, services, energy, consumer goods, and chemicals. The group plans to list a number of new companies through IPOs in the upcoming years. Given Tata Technologies’ strong listing history in 2023, it makes sense that investors are anticipating the Tata Group’s next initial public offerings, according to market experts.

Here are five Tata companies that might go public in the next few years:

1. Tata Sons

Tata Sons is a key investment holding company and promoter of Tata Group companies. Tata Sons, the parent company of the Tata Group, works in a variety of sectors, including energy, consumer products, and information technology. According to ICICI Securities, Tata Sons is worth around Rs 11 lakh crore.

“The group may sell around a 5% stake in the IPO, which makes the IPO size Rs 55,000. It would make it the largest IPO in the Indian IPO industry,” according to ICICI Securities.

Tata Sons is currently preparing for its IPO. The RBI classified the company as an upper-layer non-banking financial corporation (NBFC), which means it must go public by September 2025. After being classified as an upper-layer NBFC, a business is required by RBI regulations to go public within three years. Size and overall IPO size are yet speculative and not confirmed, although sources suggest it might be the largest IPO in Indian history. However, considering Tata Sons’ size, the IPO is expected to surpass Hyundai India’s IPO size, but nothing is disclosed.

2. BigBasket

Bigbasket (Innovative Retail Concepts Private Limited) is a Tata Enterprise, owned by the Tata Group. Bigbasket is a grocery store that operates in the online grocery segment in India that offers a wide range of products. The company is headquartered in Bangalore, Karnataka, India, and is currently owned by Tata Digital, a Tata Group subsidiary.

The company is one of India’s largest online food and grocery stores, serving over 10 million customers. The company’s platform makes grocery shopping and browsing simple and comfortable. Moreover, BigBasket is exploring the expansion of its offline presence and expanding in BB Now, the quick commerce arm of the company.

Bigbasket is preparing to list in 2025 or early 2026, the decision contingent on its profitability trajectory, according to market experts. The money raised from the IPO will be used to strengthen its rapid commerce business and expand its countrywide reach in order to maintain market leadership.

3. Tata Advanced Systems (TASL)

Tata Advanced Systems Limited (TASL), a wholly owned subsidiary of Tata Sons. TASL is both an operating & a holding company. The company is eyeing an IPO in the coming years amid the thriving military and civil aviation sectors. TASL is the strategic aerospace and defense arm of the Tata Group. The company focuses on aerospace and defense manufacturing, including military vehicles, missiles, radars, and unmanned aerial vehicles (UAVs).

TASL is an important component of the global supply chain due to its extensive portfolio of partnerships and joint ventures with leading aerospace and military firms throughout the worldIn certain cases, the company serves as a global single-source supplier to major defence original equipment manufacturers. Furthermore, by working with industrial titans like Airbus, TASL strengthens India’s military capabilities by producing new munitions and expanding its supply network.

4. Tata Capital

Tata Capital is a subsidiary of Tata Sons that offers financial services, including commercial and consumer loans, investment banking, and credit cards. Functioning as an NBFC, Tata Capital provides a comprehensive suite of financial solutions across key areas, including Commercial Finance, Consumer Loans, Wealth Management, and the distribution of Tata Cards.

The primary driver for this IPO is to meet the Reserve Bank of India (RBI) regulations, which require upper-layer NBFCs to be listed on stock exchanges by September 2025. According to reports, the Tata Capital IPO is expected to raise around $2 billion (approx. Rs. 15,000 crore) and is likely to include both main and secondary share offers.

5. Tata AutoComp Systems

Tata Autocomp Systems (TACO) is an auto ancillary company that specializes in manufacturing auto component products and services. TACO is a wholly owned entity by Tata Group, with Tata Sons holding approximately 21% and the remaining stake held by Tata Industries Ltd. It has 51 manufacturing facilities across India, North America, Latin America, Europe, and China. The company once planned to raise Rs 750 crore through an IPO in 2011, though the IPO was later withdrawn.

According to the reports, the first talks are focused on determining which Tata Group companies would sell their TACO shares and how many shares will be sold in the IPO. After an unsuccessful attempt to enter the primary market in 2011, this would be the company’s most recent attempt.

Bottom Line

In the coming years, Tata Group’s anticipated IPOs could offer exciting opportunities for investors looking to tap into the growth potential of one of India’s trusted conglomerates. Tata IPOs may in the future excite the market and prospective investors, even if some investors may deem the company’s current stocks to be expensive. A number of Tata Group businesses have achieved remarkable performances in the past year. With good performance from multiple Tata Group firms, including TCS, Titan, Tata Power, and the recently listed Tata Technologies Ltd., the group’s businesses appear prospective for IPOs. Nonetheless, Trent and Tata Motors contributed to these incredible results. As these are companies gear up for public listing, market participants should closely monitor their financial performance, industry trends, and regulatory developments. While IPOs can bring significant growth prospects, investors should conduct thorough research and assess their risk appetite before making investment decisions.

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