RBI pushes Tata Sons towards listing, SP Group offers stake sale

The Reserve Bank of India (RBI) has rejected Tata Sons' application to surrender its core investment company registration, pushing the holding company closer to a mandatory stock market listing. In a new FAQ, the RBI clarified that being debt-free is not enough to escape listing rules, what matters is access to 'public funds', which includes money raised indirectly through group companies. This leaves Tata Sons classified as an upper-layer NBFC, subject to enhanced regulatory requirements.

Meanwhile, the Shapoorji Pallonji (SP) Group, which holds an 18.38% stake in Tata Sons, has offered to sell up to 3% back to the holding company for Rs 25,000 crore, presenting an alternative to a public listing. The proposal, presented by Tata Trusts chair Noel Tata to the Tata Sons board, values the holding company at about Rs 8.3 lakh crore. SP Group faces a Rs 3,500 crore debt repayment by the end of September and has its entire stake pledged to creditors.

Axis Capital estimates that if Tata Sons lists at Rs 10 lakh crore, Tata Power's 1.65% holding would be valued at Rs 16,500 crore, adding around Rs 35 per Tata Power share. Separately, the Tata Sons board has approved a fresh five-year term for executive chairman N Chandrasekaran, reversing his earlier decision not to seek reappointment.