Tata Sons recently transferred a 0.65% stake in TCS. (File)
New Delhi:
Tata Sons may be considering a mega revenue campaign for the first time to raise money for new businesses. It recently offloaded a 0.65% stake in IT giant Tata Consultancy Services to raise Rs 9,300 crore, a first in the direction the Tatas appear to be heading.
Tata Group had so far avoided asset monetization as a strategy but has now changed its policy and the recent stake sale in TCS was part of this new strategy, a senior executive told WhatsNew2Day Profit.
Prior to this, Tatas had divested its stake in TCS only twice: in 2006 and 2007. TCS, India’s largest software services provider, has also bought back shares worth Rs 83,000 crore since 2017. Tata Sons received nearly Rs 60,000 crore from the buybacks.
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However, the group may need more money to focus on new activities such as clean energy and semiconductors.
Tata Sons Chairman N Chandrasekaran, while addressing the WhatsNew2Day Indian of the Year 2024 event on Saturday, highlighted the foray into electric mobility, new energy and semiconductors.
Tata companies are likely to go public
The group can divest its holdings through the sale of shares and debut on the stock market through initial public offerings (IPOs). Tata Play, the group’s DTH provider, has already filed a confidential IPO application with the stock market regulator.
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Financial services such as Tata Capital, Tata AIG and Tata AIA are also expected to be in the mega IPO drive. In the infrastructure sector, Tata may want to divest its stakes in Tata Realty, Tata Housing and Tata Projects. Tata Digital’s brands, such as Tata Cliq, Tata 1mg, Big Basket and Croma, are also among the potential candidates.
Creating value
Tata Sons, which has been phenomenal in creating value from its investments, had invested Rs 61,453 crore in its listed companies as of March 2023, while the combined value stood at Rs 11.2 lakh crore. Its investment in unlisted subsidiaries stood at Rs 56,646 crore, including Rs 18,942 crore in its digital ventures and Rs 7,497 crore in Tata Capital.