Wednesday, April 24, 2024

Tata Sons Eyes Mega Monetisation Of Assets Via Stakes Sale, IPOs


Tata Sons recently offloaded a 0.65% stake in TCS. (File)

New Delhi:

Tata Sons may be looking at a mega monetisation drive for the first time to raise funds 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 seem to be heading.

Tata Group had so far avoided monetising assets as a strategy but has now modified its policy and the recent stake sale in TCS was part of this new strategy, a senior executive told NDTV Profit.

Prior to this, Tatas had divested their stake in TCS only twice – in 2006 and 2007. TCS, the biggest software services provider in India, 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 funds to foray into new businesses like clean energy and semiconductors.

Tata Sons chairman N Chandrasekaran, during his speech at NDTV Indian of the Year 2024 event last Saturday, emphasized the foray into electric mobility, new energy and semiconductors.

Tata Companies Likely To Bring IPO

The group may divest its stakes via stakes sale and share market debuts by initial public offerings (IPOs). Tata Play, the group’s DTH provider, has already made a confidential filing for an IPO with the share market regulator.

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Financial services like Tata Capital, Tata AIG and Tata AIA are also expected to be in the mega IPO drive. In infrastructure sector, Tata may look to divest its stakes in Tata Realty, Tata Housing and Tata Projects. Tata Digital’s brands like Tata Cliq, Tata 1mg, Big Basket and Croma, are among the potential candidates as well.

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 was Rs 56,646 crore, including Rs 18,942 crore in its digital ventures and Rs 7,497 crore in Tata Capital.

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