Listing Tata Sons will help resolve multiple issues within the group

Tata Trusts, a philanthropic body, owns 66% of Tata Sons, which oversees about 26 listed companies along with several unlisted firms, adding to the complexity of the group's shareholding structure

Recent developments in the Tata group have brought the focus back on the merit of the public listing of Tata Sons, the holding company of the salt-to-semiconductor conglomerate. Against the current backdrop of infighting within Tata Trusts — the largest shareholder of Tata Sons — and the absence of a consensus between the two sides on critical issues like leadership and the way forward in business, the importance of listing Tata Sons must be emphasised. Saddled with a complex ownership structure, listing it is expected to ring-fence the conglomerate from various risks. Tata Sons was designated an upper-layer non-banking financial company by the Reserve Bank of India (RBI) in September 2022, mandating its listing in three years. The RBI has not responded to the group’s request seeking a change in classification from an upper-layer core investment company even after the deadline expired in September 2025. While nothing can stop Tata Sons from filing for an initial public offering (IPO), regulatory clarity on the matter would help in settling a long-pending issue.

 

The need for listing Tata Sons has gained importance after the latest developments at a Tata Sons board meeting on February 24. At this meeting, Noel Tata, chairman of Tata Trusts, the majority shareholder in Tata Sons, reportedly linked the issue of Tata Sons’ listing to the renewal of N Chandrasekaran’s term as its executive chairman. Mr Tata, who had six months ago recommended a third term for Mr Chandrasekaran, with Tata Trusts passing a resolution on this, is reported to have asked him at the meeting for an assurance that Tata Sons would remain private. Other conditions related to the profitability of some Tata entities were also part of the discussion on the renewal of Mr Chandrasekaran’s term, leading to the decision getting deferred. A conditional renewal of the top leadership term, as  reportedly proposed by Mr Tata, has not only sent out a message of uncertainty but has also raised a question mark on governance within the group.

 

As for the complexity of the shareholding structure, Tata Trusts, by definition a philanthropic organisation, owns 66 per cent in Tata Sons, which operates around 26 public listed companies and many other unlisted firms. Adding to the complexity, Mr Tata, who became chairman of Tata Trusts after Ratan Tata’s passing in October 2024 and subsequently joined the Tata Sons board, holds top leadership positions in several Tata entities such as Trent, Voltas, and Tata Investment Corporation. He’s also vice-chairman of Titan and Tata Steel. Also, the second-largest shareholder in Tata Sons is the Shapoorji Pallonji group, an infrastructure and construction major, with an 18 per cent stake. On its part, the Shapoorji Pallonji group, which has been engaged in a long-winding legal battle with the Tatas following Cyrus Mistry’s ouster as Tata Sons chairman in October 2016, has been pressing for Tata Sons’ listing to liquidate its stake and service the accumulated debt.

 

When a top business conglomerate such as the Tata group faces challenges repeatedly — the biggest being the boardroom ouster of Cyrus Mistry — uncertainty impacts the entire ecosystem. The government stepped in to resolve the crisis at Tata Trusts last year and is reported to be keeping a close watch again. It’s for the Tatas to set its house in order now and listing Tata Sons is possibly the first step in that direction.