After the Reserve Bank of India (RBI) responded to Tata Sons’ plea for an exemption from an initial public offering (IPO), the share price of Tata Chemicals increased by more than 2% on Tuesday.
The price of Tata Chemicals’ shares on the BSE surged by as much as 2.5 per cent to ₹1,134.00 per share. At ₹1,119.95, the Tata Group stock opened higher than its closing price of ₹1,106.40. On the BSE, it fell as low as ₹1,119.65 and rose as high as ₹1,134.00.
According to sources, the RBI responded to a Right To Information (RTI) application by stating that it was looking into Tata Sons’ application to be exempt from the IPO.
“Has a decision been taken on the application of Tata Sons?” was the query in the RTI application that the RBI responded to on November 14, according to the news source.
According to the article, the RBI stated in the RTI reply that Tata Sons’ application to surrender its Certificate of Registration (COR) as a Core Investment Company (CIC) is “under examination.”
According to RBI rules, companies that are designated as “upper-layer NBFCs” must list on the stock exchanges within three years of their designation. Tata Sons will therefore need to remain listed until September 2025.
Shares of Tata Chemicals were overlooked by investors, but should Tata Sons move forward with an IPO, they might be a major benefactor of a value-unlocking effort.
Tata Chemicals’ 3% stake in Tata Sons was estimated earlier this year by brokerage firm Spark Capital to be worth around ₹19,850 crore, or nearly 80% of the company’s market valuation at the time. However, the valuation dynamics might call for a reevaluation given that, as of December 2024, the company’s market capitalization had surpassed ₹28,600 crore.
Tata Chemicals’ stock was up 1.55% at ₹1,123.50 per share on the BSE at 11:35 AM.
