N. Chandrasekaran’s coming exit has put a 3.3-fold stock market wealth creation run at Tata Group into a sudden succession test, forcing investors to assess whether the conglomerate’s listed companies can sustain their gains amid mounting pressure at some of its largest businesses.
The combined market value of Tata Group companies has climbed 3.3-fold since Chandrasekaran took charge of Tata Sons on Feb. 21, 2017, and now stands at about Rs 22.5 lakh crore. Some of the biggest advances over that period include gains of about 1,700% in Trent, 1,140% in NELCO, 1,060% in Tata Investment Corp., 1,020% in Titan Co. and 670% in Tata Consumer Products.
The market’s initial verdict on the leadership uncertainty was swift. Tata Consultancy Services slid 5.3% on Wednesday, making India’s largest IT services exporter the biggest loser on the Nifty 50. Tata Motors Passenger Vehicles Ltd. fell 3.3%, while Titan and Tata Steel dropped more than 2% each, adding pressure on Indian equity benchmarks.
