Tata Sons listing could unlock value in Tata group stocks after recent selloff

ET Intelligence Group: The stocks of Tata group companies including Tata Steel, Tata Motors PV, and Tata Chemicals are likely to gain momentum after losing 8-22% on the bourses in three months. Investors are expected to price in stakes of these companies in Tata Sons as it inches closer to listing publicly following the RBI's instructions to comply with the regulations governing the upper-layer investment companies.

Each of these three companies hold 2.5-3% stake in Tata Sons, the group's holding company. In all, seven listed and two unlisted group companies hold between 0.4% and 3.1% stake each in Tata Sons.

For Tata Chemicals, the estimated value of its 2.5% stake in Tata Sons is around ₹30,000 crore, nearly two-times its market cap of ₹15,597 crore. The stock has lost 18% in three months and 20% year-to-date.


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Tata Sons' market valuation is estimated to be ₹11.9 lakh crore based on the value of its stakes in group companies.

Each of Tata Steel and Tata Motors PV owns around 3.1% stake in Tata Sons, amounting to ₹36,348 crore or 16% and 33% of their respective market caps in that order.

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Other group companies including Indian Hotels, Tata Consumer and Tata Power hold 0.4-1.6% stake in Tata Sons. Together, these six companies hold an estimated ₹1.4 lakh crore worth of shares in Tata Sons.