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Tata Group stocks faced sharp swings during the holiday-shortened week as investors tracked fresh developments around the proposed Tata Sons IPO. Seven listed companies with stakes in Tata Sons ended the week with mixed gains, even as a leadership dispute triggered heavy selling on Friday.
The rally began on Tuesday after the Reserve Bank of India rejected Tata Sons’ request to surrender its Certificate of Registration. Tata Sons had sought classification as an unregistered Core Investment Company. The RBI decision renewed expectations that the holding company may need to list its shares.
Buying resumed on Thursday after the Tata Sons board approved another five-year term for Chairman N Chandrasekaran. The board also started the process for the long-awaited Tata Sons IPO. However, Tata Trusts opposed the reappointment and called it a “legal nullity,” raising fresh doubts about the listing plan and group leadership.
Tata Chemicals recorded the strongest weekly performance among the seven companies. Its shares hit the 20% upper circuit on Tuesday and gained another 6.5% on Thursday. However, the stock fell about 11% on Friday as investors reacted to the dispute between Tata Trusts and the Tata Sons board. It still ended the week 13% higher.
The company owns a 2.5% stake in Tata Sons, valued at about Rs 30,052 crore. This holding remains large when compared with Tata Chemicals’ market value. Gaurav Garg, head of research at Lemonn, said the Tata Sons listing story forms a large part of the valuation case for smaller listed companies. “That cuts both ways, and today it cut one way,” he said after Friday’s decline.
Tata Investment Corporation gained 8% over the week despite losing 2.5% on Friday. The company owns a 0.08% stake in Tata Sons, valued at around Rs 950.3 crore.
Tata Power finished the week about 3% higher. Its shares closed near Rs 375 on Friday, gaining almost 2% during the session despite weakness across several group companies. Tata Power holds a 1.65% stake in Tata Sons, valued at approximately Rs 19,599 crore.
Indian Hotels Company gained around 2% during the week. The company owns 1.11% of Tata Sons, worth an estimated Rs 13,185 crore. Tata Motors Passenger Vehicles rose only 1% for the week after gaining more than 4% on Thursday and falling over 3% on Friday. It owns a 3.06% stake valued at about Rs 36,348 crore.
Tata Steel, which also holds a 3.06% stake, added around 1.4% during the week. Meanwhile, Tata Consumer Products ended almost flat with a 0.5% gain. Its 0.43% Tata Sons holding carries an estimated value of Rs 5,107.7 crore.
Listed Tata Group companies lost about Rs 38,361 crore, or $4 billion, in combined market value on Friday. Tata Consultancy Services fell 3.88%, while Tata Chemicals dropped 11.04%. Tata Elxsi, Tata Motors Passenger Vehicles, Tata Investment Corporation and Tata Steel also closed lower.
Tata Trusts, which owns 66% of Tata Sons, opposes Chandrasekaran’s new term and a possible listing. Analysts said investors will now watch whether both sides reach an agreement or take the matter to a tribunal. Until the dispute clears, news around the Tata Sons IPO may continue to drive volatility across Tata Group stocks.
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