Tata Sons Non-public Restricted has seen a drop in its internet debt  to Rs 5,656 crore within the first 10 months of the fiscal yr with its money reserves swelling to  Rs 9,516 crore in the identical interval. As per Capitaline information, Tata Sons’ internet debt was Rs 5,132 crore in 2015-16. However between March 2017 and March 2023, Tata Sons’ internet debt hovered above the Rs 14,700 mark. It was the best, Rs 27,437 crore, on the finish of March 2019, Enterprise Customary reported. 

Alternatively, the Tata Group’s holding firm gross debt nearly halved to Rs 15,173 crore till January 2024 on a standalone foundation. It peaked at Rs 31,363 crore in March 2019 (FY2020). 

The sudden enhance within the money reserve is a constructive turnaround for the corporate, which is betting large in newer segments, corresponding to semiconductors, electrical car batteries, and the aviation enterprise, the report mentioned.

The sharp fall in internet debt in 2023-24 clearly exhibits that the corporate might quickly emerge as a internet debt-free firm. This is because of a pointy lower in its money infusion into the loss-making Tata Teleservices, whereas dividends and buybacks from its subsidiaries, corresponding to Tata Consultancy Companies, have risen considerably, sources instructed Enterprise Customary. 

As per the report, a serious a part of Tata Sons’ money previously six years was used to inject cash into Tata Teleservices, because the latter paid off its financial institution debt and different dues to the Indian authorities, totaling Rs 60,000 crore. “Whereas a number of different telecom corporations filed for chapter following the opposed 2G Supreme Courtroom order, Tata Sons repaid all financial institution dues previously 5 years of Tata Teleservices,” the supply mentioned.

Final yr, the Reserve Financial institution of India (RBI) categorized Tata Sons as an upper-layer non-banking monetary firm (NBFC), making it obligatory for the corporate to checklist itself on the inventory exchanges by September 2025.

On September 14, 2023, the RBI had notified 15 corporations, together with Tata Sons, underneath this class. The holding firm would now should checklist on the bourses by September 2025.

Earlier this week, a report said that Tata Sons may fetch a valuation of Rs 7-8 lakh crore in an preliminary public providing (IPO), contemplating the present market capitalisation of group corporations.

The market worth of Tata Sons’ listed investments is estimated at Rs 16 lakh crore, a report revealed by funding banking agency Spark PWM said. The group may derive one other Rs 1-1.5 lakh crore of worth from unlisted investments and step-down subsidiaries corresponding to Tata Applied sciences, Tata Metalliks and Rallis.

Tata Trusts owns a 66 per cent stake in Tata Sons, whereas the Mistry household owns an 18.5 per cent stake within the firm. An IPO by Tata Sons would offer an exit for the Mistry household, which is at the moment going through liquidity points as a result of excessive debt. 

Tata Capital, a subsidiary of Tata Sons, has additionally been tagged by the RBI as an upper-layer NBFC and is required to be listed by September subsequent yr. A list of Tata Capital would result in money era for Tata Sons, which at the moment owns a 94 per cent stake in Tata Capital.

4 group corporations – Tata Motors, Tata Chemical substances, Tata Energy and Indian Motels Firm (IHCL) – maintain possession in Tata Sons. The one lifelike means for potential worth unlocking of Tata Sons stake is thru Tata Chemical substances whereby the possession is about 80% of the corporate’s market capitalisation. The stake is price about 16-21% of the mcap for the opposite three corporations, the report mentioned.

An earlier report by Kotak Securities mentioned Tata group was contemplating promoting a 5% stake in Tata Sons via the IPO to lift about Rs 55,000 crore at an estimated valuation of Rs 11 trillion.