CRISIL

ICRA

Tata Capital Housing Finance is planning to raise Rs 8,000 crore as debt in one of its largest fundraising exercises. The board of Tata Capital Housing Finance, a subsidiary of Tata Capital Financial Services, will meet on February 5 to discuss the fundraising plan. The proceeds will be used to increase the company’s presence in the fast-growing housing finance market. Of the Rs 8,000 crore, the company will raise debentures qualifying as subordinated debt, or Tier-II capital, of up to Rs 500 crore. Tier-II capital is the second layer of capital that a non-banking firm or a bank must keep as part of its required reserves.

Tata Capital Housing Finance to raise Rs 8k cr

Tata Capital Housing Finance Ltd (TCHFL), the mortgage lending arm of the Tata group, is planning to raise up to Rs 3,500 crore through non-convertible debentures (NCDs) to support business growth. TCFHL, a subsidiary of Tata Capital Ltd, enjoys good financial flexibility and has access to funds at competitive rates of interest from various sources, said rating agency ICRA, which has assigned “AAA” rating to the proposed NCD offering.

Tata Capital Housing Finance to raise up to Rs 3,500 crore via NCDs

Tata Capital Housing Finance Ltd (TCHFL) plans to ink a pact with group firm Tata Consultancy Services (TCS) to raise funds through debentures, term loans, etc. and avail services for value up to ₹5,150 crore in the current financial year (FY26). In its FY25 annual report, TCFHL said it has proposed to enter into related-party transactions with TCS. As a part of its borrowing programme, TCFHL raises funds through various instruments such as term loans, inter-corporate deposit, and non-convertible debentures (NCDs), etc. On a few occasions, Tata group companies have also participated in the NCD issuance of TCFHL.

TCHFL, TCS to ink pact for loans, services worth ₹5,150 cr in FY26

A March 2025 capital infusion boosted net worth to ₹32,563 crore, though high growth raised gearing to 6.5x. Solvency remains comfortable at 5.4%. To support future expansion, TCL plans an IPO this fiscal, backed by continued support from parent TSL.


The issuer has made timely interest payment

  Sarosh Amaria, Managing Director

Tata Capital Limited (TCL), 92.8% owned by Tata Sons (TSL), benefits from the "Tata" brand's financial flexibility, diversified funding, and strong parental support. This includes management oversight and over ₹7,400 crore in capital infusions since FY2019. ICRA expects TSL to maintain majority control and provide further capital if needed.


The combined TCL+TCHFL lending book grew 41% to ₹2,21,950 crore in FY2025, boosted by the TMFL merger and retail/corporate growth. Retail loans now represent 63% of the diversified portfolio. Within this, TCHFL’s book increased to ₹66,955 crore (from ₹52,042 crore in FY2024), spanning housing, LAP, and builder loans.


Consolidated asset quality remained healthy in FY2025, with GS3 and NS3 at 1.9% and 0.8% (up from 1.5% and 0.4% in FY2024 due to the TMFL merger). Provision coverage was 59%. Standalone, TCHFL improved to 0.8% (GS3) and 0.3% (NS3). ICRA expects continued stability and strong coverage across the group.


Consolidated NIM hit 5.0% in FY25, but higher credit costs and opex from the TMFL merger lowered consolidated RoMA to 1.7% (vs 2.1%). Conversely, TCHFL remained stable with a 2.4% RoMA and ₹1,499 crore profit. Success now depends on retail growth and controlling credit slippages.


Rating agency	Rating	Needle position
CRISIL	AAA Stable	near High Safety
ICRA	AAA Stable	near High Safety

Security Name: 8.15% Tata Capital Housing Finance Limited 19 Aug 2032

ISIN: INE033L08312

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