Tata Capital, the financial services arm of the Tata Group, has filed updated draft papers with Sebi for a mega initial public offering (IPO) estimated at $2 billion (Rs 17,200 crore), people familiar with the matter said. The IPO is expected to value the company at around $11 billion.According to the updated Draft Red Herring Prospectus (DRHP) filed on Monday, the proposed public issue comprises a fresh issue of 21 crore equity shares and an offer for sale (OFS) of 26.58 crore shares. Under the OFS, Tata Sons will divest 23 crore shares, while the International Finance Corporation (IFC) will sell 3.58 crore shares, PTI reported.Tata Sons currently holds an 88.6% stake in Tata Capital, while IFC owns 1.8%.Proceeds from the fresh issue will be used to strengthen Tata Capital’s Tier-1 capital base, supporting future capital needs, including onward lending.This marks the Tata Group’s second major public offering in recent years after Tata Technologies’ successful debut in November 2023. If successful, the IPO will become the largest public issue by an Indian financial services firm.Tata Capital had earlier filed papers through Sebi’s confidential pre-filing route in April and received approval in July. Under this process, companies are required to file an updated DRHP before submitting the final Red Herring Prospectus (RHP).The IPO is also in line with the Reserve Bank of India’s listing mandate for upper-layer NBFCs, which requires such entities to go public within three years of classification. Tata Capital was designated as an upper-layer NBFC in September 2022.In FY25, Tata Capital reported a net profit of Rs 3,655 crore, up from Rs 3,327 crore in FY24. Revenue rose sharply to Rs 28,313 crore from Rs 18,175 crore a year earlier.Since commencing lending operations in 2007, Tata Capital has served over 7 million customers with a portfolio of more than 25 lending products catering to individuals, SMEs, and corporates. The company also distributes third-party financial products and manages private equity funds.The issue is being managed by a consortium of book-running lead managers including Axis Capital, Kotak Mahindra Capital, BNP Paribas, HDFC Bank, HSBC Securities, Citigroup Global Markets, ICICI Securities, IIFL Capital, SBI Capital Markets, and JP Morgan India.