As per sources to ET Now and Times Now Digital, Tata Sons' board has resolved to list Tata Sons. The Reserve Bank of India last week had rejected Tata Sons' application
to surrender its registration as a Core Investment Company (CIC), keeping the Tata Group holding company within the regulatory framework applicable to Upper Layer NBFCs. Tata Sons had filed the application in March 2024, after repaying Rs 21,813 crore of debt in FY24, in a move aimed at exiting the regulatory framework and potentially avoiding the need/requirement to list on stock exchanges. Following this rejection, the RBI has also filed a caveat in the Bombay High Court. Tata Sons is unlike a conventional holding company. Around 66% of its equity is held by Tata charitable trusts, 18.37% by the Shapoorji Pallonji Group, and around 12.8% by Tata Group companies, with the remaining stake held by individual shareholders, including members of the Tata family. At an assumed valuation of Rs 10 lakh crore, Noel Tata’s roughly 1% direct stake in Tata Sons would be worth around Rs 10,000 crore. Tata Sons' ownership structure has remained broadly stable for decades, with Tata Trusts retaining majority control. The market value of Tata Sons, however, cannot simply be calculated by adding the market capitalisation of the listed Tata companies in which it holds stakes. A holding-company discount is typically considered when valuing such a structure, as an investor in Tata Sons does not directly own the underlying shares. Samir Arora, founder of Helios Capital, noted in a post on X that listed holding companies, where the underlying companies are also listed, can trade at discounts of around 70% to their net asset value (NAV). Independent market analyst, Ambareesh Baliga told Times Now Digital, "Tata listed players who hold some stake in Tata Sons will sentimentally benefit due to discovery of the market price for their holding. For example-Tata Chemicals which holds 2.5% approximately will have Tata Sons' shares worth Rs 25,000 crore against it's own market cap of Rs 15,000 crore. The Shapoorji Pallonji Group will be the biggest gainer-they were trying to strike a deal for Tata Sons equity in the past but now they can place it with institutional investors and get the much needed cash flow for their Group." Analysts believe for consumers, Tata Sons listing could bring more transparency, scrutiny and potentially more investment across the board.
