MUMBAI: Nine Tata companies – seven listed, two unlisted – hold 12.8% of Tata Sons. The seven listed companies alone account for 11.9%. They have held these stakes (see chart), treated as dead capital, for three decades, with no exit and no public valuation. That changes if Tata Sons lists in compliance with Reserve Bank of India‘s upper layer investment company rules, reports Reeba Zachariah.Shares of the listed holders – Tata Steel, Tata Motors, Tata Chemicals, Tata Power, Indian Hotels, Tata Consumer Products and Tata Investment Corpn – are expected to gain in trading Tuesday.

Tata Motors, Tata Steel have most shares

Tata Chemicals stands out. Spark Capital estimated in March 2024 that its Tata Sons stake was worth 80% of the company’s own market cap – Rs 15,594 crore as of Friday. Some analysts now put that value above Tata Chemicals’ own market cap, making it the clearest listed proxy for any value unlocked by an IPO.

Listed holders bought Tata Sons shares through ’95-96 rights issue

The listed holders bought into Tata Sons through a 1995-96 rights issue. Tata Trusts, the promoter, did not subscribe because law barred public charities from investing in commercial entities. The rights issue kept the shares inside Tata Group.Shareholders objected at the time. They asked why listed companies should sink capital into an unlisted and illiquid parent. Ratan Tata, then Tata Sons chairman, said the investment would pay off once Tata Sons went public. Former Tata director Nusli Wadia had later argued that the cross-holdings served only to bolster Tata Trusts’ voting power in Tata Sons.Shriram Subramanian, founder of InGovern Research Services, which published a 2026 report backing a Tata Sons listing, said it would give more than 1.2 crore public shareholders in listed Tata companies a long-awaited avenue for value unlocking, and give the seven listed companies liquidity.In 2020, during its legal battle with its former group chief, late Cyrus Mistry, Tata Sons had cited an assessment by chartered accountant Y H Malegam valuing Tata Sons at Rs 3.8-4.3 lakh crore, which Mistry disputed, saying the valuation by his calculations was more than double.That figure would look different today. Tata Sons’ portfolio has changed materially since 2020 — Tata Electronics has emerged as a bright spot, Air India remains loss-making, and the market value of its listed holdings has risen sharply, though TCS has come under some pressure recently amid AI concerns.Market values Tata Sons at Rs 14 lakh crore. One analyst noted a caveat: While the market applies a holding-company discount to Tata Sons, Tata Investment — itself a holding company — has historically traded at a premium to its underlying investments, rather than a discount.RBI classified NBFCs into an upper layer partly based on indirect public-fund access through group companies. Tata Sons falls into that category — and the listing requirement followed.