Shapoorji Pallonji Group for public listing of Tata Sons

The Shapoorji Pallonji Group, one of the key shareholders in Tata Sons, has made it very clear that it is all for public listing of Tata Sons as directed by the Reserve Bank of India (RBI).

A statement from Shapoorji Pallonji Group Chairman Shapoorji Pallonji Mistry said, “I have repeatedly said that the public listing of Tata Sons is not merely a financial or regulatory matter. I most consequential business institutions, while preserving and advancing the extraordinary philanthropy is a social and moral imperative. It is about strengthening transparency and public accountability in one of India’s purpose that lies at the heart of the Tata legacy.”

Shapoorji Pallonji Group holds around 18.4% stake in Tata Sons.

The Shapoorji Pallonji Group and the Tata Group have a history that goes back to a century. However, the new statement from the company needs to be seen in the context of the opposition by Tata Trusts Chairman Noel Tata to the public listing of Tata Sons, which is the holding company of all Tata Group businesses. The Tata Trusts hold 66% stake in Tata Sons.

Also, Shapoorji Pallonji Mistry’s sister Aloo Mistry is the wife of Noel Tata.

This decision by Shapoorji Pallonji Group puts Noel Tata in a tighter position as the Board of Tata Sons have also voted in majority for the public listing. This makes Noel Tata a single individual who is against the decision to list.

The RBI rejected the request of Tata Sons to surrender its NBFC licence coming under the upper layer category and mandated it go for a public listing as per regulations. This has been consistently opposed by Noel Tata.

“The Reserve Bank of India has provided full clarity. Tata Sons had been classified as an Upper-Layer NBFC under the RBI’s Scale-Based Regulatory Framework, and the prescribed listing route followed from that regulatory architecture,” Pallonji group said.

This also needs to be taken in the context of the debt position of Shapoorji Pallonji Group, where it had recently refinanced Rs 21,500 crore and it has to pay Rs 3,500 crore by the end of September.

However, the Pallonji Group dismissed the idea of any rift with the Tata Group with regard to public listing. “This landmark decision should not be viewed as a victory of one stakeholder over another. It should be viewed as an opportunity to bring people and institutions together. The listing of Tata Sons can become a bridge,” it said.

It further noted that the relationship between the two has been built through enterprise, trust, shared experiences, and a deep understanding of the responsibilities that come with building institutions in India.

“That very philosophy should guide the next chapter of Tata Sons. The question before us should not simply be who owns what, or how a corporate structure is preserved. The larger question should be how can one of India’s greatest industrial institutions become even stronger, more transparent, more accountable and more capable of serving the nation,” it noted.