Among the third-largest block of shareholders in Tata Sons are the publicly traded group firms Tata Motors, Tata Steel, Tata Chemicals, and Tata Power.
The seven large listed firms in the Tata Group would benefit greatly if Tata Sons decided to go for an IPO.
The journey towards an IPO would unleash the value of their investment in Tata Sons, which was made years ago at far lower values than the present valuation of Tata Sons, according to a Business Standard story.
Together, the seven named group entities now own around 12.1% of Tata Sons. Large unrealized profits are the listed firms’ interest in Tata Sons, and if Tata Sons listings, the listed companies will get a “correct” market value.
Among the third-largest block of shareholders in Tata Sons are the publicly traded group firms Tata Motors, Tata Steel, Tata Chemicals, and Tata Power. These businesses follow the Shapoorji Pallonji group and Tata Trusts.
Additionally, as of the end of March current fiscal year, Trent owned a total of ₹15 crore worth of redeemable preference shares in Tata Sons, each having a nominal value of ₹1,000.
Seven Tata Trusts, together referred to as promoters, own 65.3% of Tata Sons. With 27.98% and 23.56% of the company’s shares, respectively, Sir Dorabji Tata Trust and Sir Ratan Tata Trust are the two largest shareholders in Tata Sons.
In contrast, the Shapoorji Pallonji group owns 18.4% of the company via its two investment companies, Cyrus Investments Pvt Ltd and Sterling Investment Corporation Pvt Ltd, each of which owns 9.2%.
Furthermore, the combined ownership of other stockholders, including individuals, in Tata Sons amounts to 4.2%.
There is a power struggle going on at Tata Sons and Tata Trusts, however, with certain shareholders, headed by the Shapoorji Pallonji family, attempting to have Tata Sons listed.
It is interesting to note that Tata Sons is among the few sizable holding firms that are not listed on stock exchanges.
Other major corporate groups, like Bajaj Holdings, Pilani Investments, JSW Holdings, TVS Holdings, Kalyani Investments, Tube Investments, and Bengal & Assam Company, have their holding corporations mentioned.
With a combined 3.06 percent stake, Tata Steel and Tata Motors are the two largest owners. The next companies in line are Tata Chemicals (2.53%), Tata Power (1.65%), Indian Hotels (1.11%), Tata Consumer (0.43%), and Tata Investment Corporation (0.25%). On a consolidated basis, each common share of Tata Sons, which currently has a face value of ₹1,000, is worth around ₹6.28 million. This effectively means that, on a consolidated basis, the book value at the end of March this year was around ₹2.54 trillion.
Thus, by the end of March this year, the total book value of the listed firms in the Tata group’s share in Tata Sons was ₹30,705 crore. As big holding corporations trade at multiples of their book value, the market value is probably going to be much higher, according to the BS research.
Bajaj Holdings, the nation’s biggest holding company behind Tata Sons in terms of assets, is now trading at 2.1 times its most recent book value. Additionally, the business has significant stock in the majority of the Rahul Bajaj group enterprises, such as Bajaj Finserv and Bajaj Auto.
In contrast, according to their annual reports, the investment cost of these firms’ ownership in Tata Sons is only ₹449.13 crore. It is unclear, meanwhile, whether these publicly traded group firms would sell or record gains from their stake in Tata Sons.