Tata Sons Gets a Setback from RBI.. IPO May Now Be Mandatory

Tata Sons, the holding company of the Tata Group, has reportedly suffered a setback after the Reserve Bank of India rejected its application to surrender its Non-Banking Financial Company licence. According to sources, Tata Sons had submitted the application in March 2024, reportedly seeking to avoid the requirement of listing its shares on the stock market. Neither the RBI nor Tata Group has officially commented on the matter so far.

The RBI’s reported decision could make a public listing necessary for Tata Sons. The company’s name was retained in the RBI’s latest list of Upper Layer NBFCs released last month. Companies classified under this category are subject to stricter regulatory requirements covering governance, investments and disclosures. They are also required to list their shares on stock exchanges. As a result, Tata Sons may now have to consider an IPO to comply with the applicable regulations.