Tata Sons, the parent company of the Indian conglomerate, could reach a valuation of US$96 billion, or 8 trillion Rupees, in an upcoming IPO expected to occur in the next year and a half.
Its investments include Tata Consultancy, the software giant, Jaguar Land Rover maker Tata Motors Limited (NYSE:TTM) and Indian airline Vistara.
The group also owns Tata Steel, which recently announced teh closure of two blast furnaces at Port Talbot in Wales with the loss of thousands of jobs.
India’s central bank classified the business as an “upper-layer” non-banking financial company back in September 2022.
Companies classified in this category are required to seek a public listing within three years.
“There are multiple levers of value available from the unlisted investments as the group is entering into new age segments such as semi-conductors,” Vidit Shah, an analyst at Spark Private Wealth Management, said.
The Indian market has seen a horde of companies attempting to sell shares as their valuations continue to soar.
Meanwhile, the number of IPOs is building, with 56 since the start of 2024, marking a more than 50% jump over 2023.
Tata Sons’ listed investments are believed to be worth 16 trillion Rupees, while its private holdings are valued at as much as 2 trillion Rupees, Shah added.
However, the investment banker believes between a 30-60% discount will be baked into the listing.
The IPO could “lead to the simplification of the complicated group holding structure of the Tata Group,” and may cause some of its investments to liquidate their holdings, Shah concluded.