Tata Group stocks gain on Tata Sons' IPO buzz

Several Tata Group stocks were in focus on Thursday due to the buzz around Tata Sons' IPO as several of them held a stake in it, said Siddhartha Khemka, Head of Retail Research at Motilal Oswal Financial Services. Tata Group stocks showed strong gains on Thursday. Tata Steel was the top gainer in the Sensex with gains of 4 per cent, Tata Chemicals was up 11 per cent, Tata Teleservices (Maharashtra) was up 7 per cent, while Tata Power gained 7 per cent.

Tata Consumer gained more than 3 per cent, while Tata Investment Corporation hit the upper circuit of 5 per cent. Tata Steel, Tata Consumer, and Tata Motors were among the top gainers on the Nifty. Tata Sons could potentially fetch a value of Rs 7-8 trillion at current market capitalisations of Tata Group companies, as per investment banking firm Spark PWM. Multiple levers of value are available from the unlisted investments as the group enters into new-age segments such as semiconductors (by Tata Electronics). “Thus, we believe that the group could derive another Rs 1-1.5 lakh crore of value from unlisted investments and step-down subsidiaries such as Tata Technologies, Tata Metalliks, and Rallis," Spark PWM said. “We believe that 80 per cent of Tata Sons' holdings might not be monetisable, but the restructuring process could trigger a re-rating," it added.
Four (Tata Motors, Tata Chemicals, Tata Power, and Indian Hotels) companies within the Tata Group hold ownership in Tata Sons.

Tata Sons could list within the next 1.5 years, the report said. The RBI had classified Tata Sons as an upper-layer NBFC last year, which makes it mandatory for the company to list itself on the exchanges by Septemebr 2025. “We believe that this event could likely lead to the simplification of the complicated group holding structure of the Tata Group and enable some of the listed holding companies to liquidate their holding within the giant parent conglomerate," the firm said.