Can Tata Capital Be the Stock for 2026? Breakout and Lock-In Impact

Tata Capital, the Tata Group’s non-Banking financial company (NBFC), has emerged as a strong market contender after breaking out to all-time highs in early 2026. The stock, which came to market through India’s largest IPO of 2025, is now trading at record levels and faces a critical near-term event with the expiry of its first major shareholder lock-in period.

India’s Biggest IPO of 2025

Tata Capital’s IPO raised Rs 15,512 crore, making it the largest public issue of 2025. The offering comprised a fresh issue of Rs 6,846 crore and an offer for sale of Rs 8,666 crore by existing shareholders, including Tata Sons and IFC. Priced in a band of Rs 310 to Rs 326 per share, the issue was open from October 6 to October 8, 2025, and saw strong investor demand. The stock listed on October 13, 2025, at Rs 330, a modest 1.2 per cent premium over the issue price of Rs 326.

All-Time High Breakout and Volume Surge

After spending several months in a narrow trading range, Tata Capital shares staged a decisive breakout in early January 2026. On January 2, the stock jumped nearly 5 per cent to hit a fresh 52-week high of Rs 361.80, clearly surpassing the key resistance level of Rs 350. This move signalled renewed buying interest and strengthening momentum.

The breakout was supported by exceptionally high volumes. Around 1.10 crore shares were traded on the NSE, more than eight times the previous session’s volume. The stock is trading comfortably above its 20-day and 50-day exponential moving averages, indicating a bullish reversal structure.  At around Rs 359, the share price is up roughly 11 per cent from its issue price.

Lock-In Period Expiry: A Near-Term Test

A key event to watch is the expiry of Tata Capital’s three-month shareholder lock-in period on January 7, 2026. On this date, about 71.2 million shares, equivalent to 2.00 per cent of the company’s outstanding equity, will become eligible for trading. At current market prices, the unlocked shares are valued at approximately Rs 2,573 crore.

This is the second tranche of anchor investor lock-in expiry, following the first 50 per cent unlock on November 8, 2025. While such events can lead to short-term volatility, the relatively small proportion of equity being unlocked limits the risk of heavy supply pressure, assuming broader market sentiment remains supportive.

Strong Fundamentals and Growth Outlook

Tata Capital’s financial performance underpins its positive market momentum. In Q2FY26, the company reported Assets Under Management of Rs 2,43,896 crore, a 3 per cent quarter-on-quarter increase. Profit After Tax rose 11 per cent quarter-on-quarter to Rs 1,097 crore, while Return on Equity improved to 12.90 per cent.

Management has outlined ambitious growth plans, targeting double-digit AUM growth in FY26 and a balance sheet size of Rs 7 lakh crore by FY28. According to CEO Rajiv Sabharwal, if India’s economic growth trajectory remains intact, the company’s loan book could potentially double over the next three years. These projections position Tata Capital as a structurally strong NBFC with long-term expansion potential, even as it navigates near-term market events.

Disclaimer: The article is for informational purposes only and not investment advice.