While Tata Sons resists going public, it may soon get another regulatory nudge to debut on Dalal Street as RBI is set to issue a list of non banking finance companies (NBFCs) that fall in the upper layer category.
RBI Governor Sanjay Malhotra on Wednesday said that the revised norms will be a principle-based system, while declining to specifically answer whether the Tata Group parent will be part of this list of upper layer non banking financial companies.
“It is now principle-based. So as per those principles, everyone knows what is on the list. And so that is where the matter stands,” Malhotra said, adding that under the principal based regulations, it will be easier to classify NBFCs as upper-layer, middle layer and base layer.
“All those which meet the criteria, they (will) continue….the new list is principle-based and that will continue… the status is what it was earlier,” Malhotra said.
Also read | RBI upper-layer NBFC list to come out soon
Will Tata Sons be on the list?
If Tata Sons is classified as an upper layer NBFC, it will be liable for getting publicly listed. This comes as RBI in late June released new norms for upper-layer NBFCs, bringing such companies with assets worth more than Rs 1 lakh crore under the umbrella that requires a public listing of shares. Tata Sons’ portfolio comfortably falls in this threshold.
The Reserve Bank of India’s deputy governor Shirish Chandra Murmu said the central bank will release the list of NBFCs “very soon”. RBI has not published a list of upper-layer NBFCs since January 2025.
Tata Sons IPO debate has been a widely-watched saga on Dalal Street. Several Tata Trusts trustee earlier this year supported the listing of the company, contrary to the resolution passed by Tata Trusts a year ago, which aimed to retain Tata Sons as an unlisted private entity, resisting regulatory momentum toward a potential IPO.
Tata Trusts has majority control of Tata Sons with a stake of about 66%. One section of trustees see a listing as inevitable and aligned with shareholder interests, while another remains opposed, favouring an unlisted structure to preserve control and legacy considerations. Tata Trusts Chairman Noel Tata is understood to be opposed to listing Tata Sons.
In a newspaper column with Times of India published in May, former Tata Sons vice chairman N A Soonawala said the group's ownership model has historically allowed it to support struggling companies and pursue long-term investments without the pressure of public markets.
"The argument that Tata Sons would inevitably be accountable to institutional and foreign shareholders, whose primary focus would be financial returns, is doubtful," Soonawala wrote. He added that public shareholders may not accept “substantial deployment of capital to support or rescue group companies in distress".
Also read | Tata Sons IPO: Why former Tata veteran Soonawala is warning against listing the conglomerate
Tata Sons, the principal holding company of the Tata group, controls stakes in more than 30 companies including Tata Consultancy Services, Tata Motors and Tata Steel.
The group's ownership structure is unusual among large Indian conglomerates. Around 66% of Tata Sons is held by philanthropic entities collectively known as the Tata Trusts, while the Shapoorji Pallonji Group owns 18.4%.
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