Shares of various Tata Group companies, such as Tata Motors, Tata Chemicals, Rallis India, Tata Power, Nelco, and Tata Investment Corporation, experienced significant gains of up to 15 percent on March 7, fueled by increasing speculation surrounding the anticipated Tata Sons IPO.
The impending listing of Tata Sons is anticipated to unlock substantial value and streamline the intricate holding structure of the conglomerate, potentially enabling certain listed holding firms to divest their stakes in the parent company.
Tata Sons, the primary investment holding firm and promoter of Tata Companies, was designated as an ‘upper-layer’ non-banking financial company (NBFC) by the Reserve Bank of India in 2023. According to RBI guidelines, such entities must go public within three years of notification, implying that Tata Sons is expected to be listed on exchanges by September 2025.
The IPO is highly awaited as it is poised to be not only the largest IPO for the Tata Group but also in the history of the Indian stock market. Additionally, Tata Motors shares rose by 2 percent following the announcement of an upcoming price hike of up to 2 percent on commercial vehicles from April 1, 2024, aimed at offsetting lingering impacts of previous input costs.
Shares of Tata Chemicals surged approximately 14 percent, reaching a 52-week high of Rs 1,349 on the NSE, extending gains for the sixth consecutive session. Spark Capital’s report highlighted Tata Chemicals as a viable avenue to potentially access the value unlocking of Tata Sons’ stake, estimating Tata Sons’ ownership to be around Rs 19,850 crore or 80 percent of the company’s market capitalization.
Tata Investment Corp shares remained locked in the upper circuit for the sixth consecutive day, surging by 5 percent to Rs 9,756.85, marking a new high on the NSE. The stock witnessed a remarkable 74 percent surge in the past month and a staggering 380 percent increase over the last year, significantly outperforming the benchmark Nifty 50.
Moreover, Tata Consumer Products and Tata Steel saw gains of up to 4 percent, reaching their respective record highs during intra-day trading. Other Tata Group stocks, including Tata Elxsi, Trent, Voltas, and Tata Consultancy Services, also witnessed increases ranging from 1 to 4 percent.
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