Tata Group stocks under pressure amid Tata Sons listing dispute

Tata Group stocks declined on Friday after advancing in the previous session, as investors reacted to fresh developments at the group's holding company, Tata Sons.

Tata Motors Passenger Vehicles declined 3.35%, followed by Tata Consultancy Services, which fell 2.85%. Titan Company slipped 1.03%, while Voltas declined 0.39%. Tata Power Company fell 0.36%, Tata Consumer Products shed 0.30%, Trent declined 0.14% and Tata Steel edged down 0.09%.

On the other hand, Indian Hotels Company gained 1.43%, while Tata Motors Commercial Vehicles rose 0.31%.

The stock movements came after the Tata Sons board on Thursday approved a further five-year term for N Chandrasekaran as executive chairman. The decision followed Chandrasekaran's announcement on 12 August that he would not offer himself for reappointment when his current term ends on 20 February 2027.

Tata Trusts, which holds about 66% of Tata Sons, opposed the reappointment. Tata Trusts Chairman Noel Tata voted against the resolution, while Trust nominee Venu Srinivasan voted in favour. Tata Trusts subsequently said the resolution was a legal nullity under the Articles of Association of Tata Sons. The Trusts maintains that a majority of its nominee directors must vote in favour of the appointment or reappointment of the chairman.

The Tata Sons board also discussed a communication received from the Reserve Bank of India on 11 September. The board agreed to explore and assess all available options, rather than listing alone, with the findings to be considered at a subsequent board meeting. Tata Trusts has opposed the listing of Tata Sons and reiterated its position that the company should remain unlisted.

The developments have added uncertainty around the governance and future structure of Tata Sons.

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