CHENNAI: The Indian primary market remains active this week with two high-profile issues — Tata Capital and LG Electronics India — drawing investor attention. While Tata Capital’s IPO has entered its second day of subscription, LG Electronics opened its issue on Tuesday.
The Rs 15,512-crore Tata Capital IPO, a mix of fresh issue and offer for sale, opened for subscription on October 6 and will close on October 8. The price band is fixed at Rs 310–Rs 326 per share.
As of Day 2 (October 7), the issue was subscribed about 46–47 percent overall. Segment-wise, the Qualified Institutional Buyer (QIB) category saw around 0.52 times subscription, while the Non-Institutional Investor (NII) and Retail categories stood at 0.24 times and 0.35 times, respectively.
On the first day, the response was moderate, with total bids around 30–35 percent of the issue size. The employee quota attracted stronger interest, nearing full subscription early on.
Tata Capital raised Rs 4,641 crore from anchor investors ahead of the issue opening, with LIC emerging as the largest participant. Shares were allotted to anchor investors at Rs 326 per share — the upper end of the price band.
Despite solid institutional backing, market enthusiasm has been cautious. The grey market premium (GMP) has dropped sharply from early highs to around 3–4 percent, suggesting limited expectations of immediate listing gains. Analysts attribute the subdued sentiment to a rich valuation — around 32 times FY25 estimated earnings — and a cautious tone in broader markets.
Brokerages largely maintain a “Subscribe for Long-Term” recommendation, citing Tata Capital’s strong brand, diversified lending portfolio, and growth prospects in retail and SME finance. However, near-term speculative interest remains low.
LG Electronics India
The Rs 11,607-crore IPO of LG Electronics India opened for subscription on Tuesday (October 7) was subscribed 73% as of 3:10 p.m., receiving bids for 5.21 crore shares against 7.13 crore shares on offer. Retail investors accounted for 2.4 crore bids out of the 3.55 crore shares reserved for their category.
The issue, which will close on October 9, is a pure offer for sale (OFS) by the South Korean parent company and carries a price band of Rs 1,080–Rs 1,140 per share.
Ahead of the public issue, LG Electronics raised around Rs 3,475 crore from anchor investors, including ADIA and Goldman Sachs, at the upper end of the price range. The response from institutional investors has been strong, signaling confidence in the company’s India growth story.
In the grey market, LG Electronics commands a significant premium of around 20–25 percent, reflecting positive sentiment and expectations of robust listing gains. Brokerages have highlighted LG’s strong brand visibility, leadership in home appliances, and growth potential in premium electronics as key positives.
However, as this is an OFS, proceeds will go to the parent company rather than to fund expansion of the Indian arm. Analysts note that while investors may benefit from listing gains, the IPO will not directly strengthen LG India’s balance sheet.
According to market analysts, both IPOs have drawn considerable interest, though the nature of demand differs. Tata Capital’s offering appeals more to long-term investors, supported by its strong financial position and steady growth in retail lending. The muted GMP suggests limited speculative activity but a solid institutional base.
In contrast, LG Electronics India has emerged as a short-term favorite, with strong early demand and a high grey market premium pointing to expectations of healthy listing gains. Yet, being a pure OFS, it offers no fresh capital inflow for business expansion in India.
Analysts advise investors to evaluate objectives carefully — Tata Capital for stable long-term returns aligned with India’s financial growth, and LG Electronics for potential near-term listing gains driven by brand strength and investor enthusiasm.
