Shares of Tata Capital Ltd experienced a 4 percent decline during Monday's trading session, trimming gains achieved from a robust 9 percent rally over the preceding two days. The stock fell to a low of Rs 356 on the BSE, following a 6.18 percent jump on Friday and a 2.48 percent rise on Thursday.
The recent market movement comes as the company's board approved a significant fund-raising initiative. Tata Capital plans to raise up to Rs 36,000 crore through a private placement, to be executed in one or more tranches, pending shareholder approval.
Analyst Perspectives on Tata Capital Shares
Despite the recent correction, financial analysts largely maintain a positive outlook on Tata Capital. JM Financial noted that Tata Capital shares have undergone a "time-correction" since their initial public offering (IPO).
JM Financial reinforced its confidence in the company, citing "visible levers" such as the expansion of its high-yield loan book, an improving profitability trajectory within its motor finance segment, and sustained high growth. Consequently, JM Financial upgraded its rating on the stock from 'Add' to 'Buy' and increased its target price to Rs 400 from Rs 380, valuing it at 2.8 times FY28E Book Value Per Share (BVPS).
Nomura's Insights on Liquidity and Asset Quality
Nomura, following a meeting with Tata Capital's management, reported that liquidity is not a concern for the company. However, the cost of funds remained elevated during the June quarter, a trend contrary to typical seasonal declines observed between June and March. To mitigate this, management has reportedly passed on these higher costs in select business segments.
Furthermore, Nomura indicated no major concerns regarding asset quality trends, noting improved bounce rates in June 2026 compared to April 2026, which itself was an improvement over a spike seen in March 2026. Despite these positive indicators, management has adopted a cautious approach, tightening underwriting standards in commercial vehicles, commercial equipment, and certain SME segments. Nomura also issued a 'Buy' recommendation for Tata Capital shares, setting a target price of Rs 400.