The discussion has once again intensified regarding the IPO of Tata Sons, the holding company of Tata Group. However, this issue depends on the decision of the Reserve Bank of India (RBI). Tata Sons had applied to RBI in March 2023 to deregister its Core Investment Company (CIC). However, even after eight months have passed, no decision has been taken on this.
Is this Tata’s compulsion?
RBI has classified Tata Sons in the upper layer of Non-Banking Finance Company (NBFC). According to RBI rules, it is mandatory for all companies falling in this category to list their stock exchanges by September 2025. To avoid this requirement, Tata Sons has decided to give up its CIC registration, thereby exempting it from listing.
Tata Sons has repaid the entire loan of Rs 21,813 crore in the financial year 2023-24. Subsequently, the company applied to the RBI to be removed from the NBFC upper layer and classified as an unregistered CIC. If this happens, the company will not need to be listed in the stock market.
this is the matter
However, RBI has not yet taken any decision on this application of Tata Sons. According to sources, Tata Group is not in favor of taking Tata Sons public. Earlier, Tata Group had proposed to RBI for exemption from listing, which was rejected. Responding to a query by an investor under Right to Information (RTI), RBI confirmed that Tata Sons had applied to give up CIC registration on March 28, 2023. RBI also said that the application is being examined. However, till now no information has been revealed regarding its acceptance or rejection.
The decision is in the hands of RBI
The status of Tata Sons’ IPO completely depends on the decision of RBI. The company has tried to withdraw from CIC by becoming debt free, but the silence of RBI is making the matter more complicated. It will be interesting to see what stance the Reserve Bank takes on this and what strategy the Tata Group makes for this.
