Tata Chemicals shares, which are believed to be the biggest beneficiary of the potential listing of Tata Sons, were also placed in the F&O ban list today.
Other Tata group stocks also traded with cuts. Tata Consumer stock slipped 3% while Tata Steel shares dropped over 2%. Tata Motors and Indian Hotels were down 1% each.
Under RBI rules, Tata Sons will have to get listed by September 2025 as it has been classified as an upper-layer NBFC but the Rs 31 lakh crore conglomerate is now said to be exploring options of restructuring its balance sheet. If it reorganises debt by repaying borrowing or transfers the holding in Tata Capital to another entity, Tata Sons may get deregistered as a core investment company (CIC) and upper-layer NBFC. By doing so, Tata Sons can avoid getting listed, ET reported earlier.
Also read | Tata Sons trying to avoid IPO. Is it Ok Tata Bye Bye for multi-billion-dollar rally?
The RBI has already turned down a request from the Tatas seeking an exemption to the listing rule.Led by over-enthusiastic retail investors, Tata Group stocks gained Rs 85,000 crore in market cap last week. A large part of the rally was attributed to retail buying on hopes of Tata Sons IPO.The rally began last Monday after investment banker Spark Capital released a report identifying Tata Chemicals as the only potential play in the IPO. “Should the street assign a Rs 10-11 lakh crore valuation to Tata Sons, the intrinsic valuation of the listed Tata Chemicals business is 5-7x FY25 PE, which could potentially re-rate should the investment be liquidated at/or post IPO,” Spark’s Vidit Shah said.
Calculations done by the brokerage show that the value of Tata Chemicals’ 3% stake in Tata Sons is worth around Rs 19,850 crore or 80% of the market value of the company.
Also read | If Tata Sons brings out IPO, which listed Tata stock will gain the most?
“The intrinsic business of Tata Chemicals is trading at ~11x FY25 PE (worth Rs 10,900 crore), which we believe to be fair given the headwinds that the soda ash industry is currently facing. However, valuations could potentially re-rate on announcements of growth plans/ improvement in soda ash realisations,” Shah said.
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