Noel Tata Will Live Up To Everyone’s Expectations And Bring Tata Sons’ IPO

The businesses of Parsis have never focused solely on maximizing profits. They believe in earning profits and then utilizing a significant portion of them for betterment of the society

Noel Tata, like his predecessor Ratan Tata, enjoys a clean and respectable image. Now that he has become chairman of Tata Trusts, it is expected that he will lead Tata Group to loftier heights into the future.

It must be duly acknowledged that the Parsi community has for centuries played a pivotal role in India’s economic development through their foresight, diligence and innovation. They have carved a unique identity for themselves in its industrial history. Noel Tata hopes to take forward this legacy with patented gusto.

The trust in his abilities has been such that soon after he took over as chairman of the Trusts, the nation’s corporate world and the Reserve Bank of India (RBI) are pinning hopes on him to pave the way for an Initial Public Offering (IPO) of Tata Sons, the holding company of the Tata Group. Most of Tata Sons’ shares are held by the Tata Trusts.

The RBI expects large Non-Banking Financial Companies (NBFCs) to go public, which essentially means they should have an IPO in the market.

Under RBI regulations, all non-banking financial companies are required to be listed on the stock market. The deadline for this was set for September 2025, and a list of around 15 companies has been released. Tata Sons, however, is among those that isyet to be listed, although it has sought relief from the RBI in this matter.

Some argue that Venugopal Srinivasan, a member of both the RBI and Tata Sons boards, represents a conflict of interest. Srinivasan was appointed to the bank’s central board for a four-year term on June 14, 2022. He also served as chairman of TVS Motors and is highly respected in India’s corporate world.

The RBI had similar expectations that Tata Sons would also bring an IPO. This, however, did not happen. There is now a renewed hope for this to transpire, as Noel Tata is known for adhering to regulations. This IPO should have happened during Ratan Tata’s time, as RBI regulations apply to Tata Sons as well.

Noel Tata has an opportunity to showcase his capabilities by starting his new journey with an IPO. It is quite a surprise that they have not gone for it till date, despite RBI regulations.

Tata Sons Private Limited is the principal holding company of the Tata Group. Almost 66 per cent of its equity share capital is held by philanthropic trusts, which support education, health, livelihood generation, and art and culture. Each Tata enterprise operates independently under the guidance and supervision of its own board of directors.

The website of Tata Group says “The Tata philosophy of management has always been, and is today more than ever, that corporate enterprises must be managed not merely in the interests of their owners, but equally in those of their employees, of the consumers of their products, of the local community and finally of the country as a whole.”

Meanwhile, following the demise of Ratan Tata, many are becoming aware of the unique and significant contribution of the Parsi community to the Indian industrial landscape. However, it is still important to highlight the contributions of Parsi entrepreneurs like the Tatas, Godrej, Wadias, and Mistrys, who have provided opportunities for growth for half of the world.

Sudha Murthy, chairperson of Infosys Foundation, recalls being an engineer at Tata Motors in 1974 and staying in touch with JRD Tata, chairman of the Tata Group. Just imagine how few women engineers were working in private companies in India half a century back.

There is another notable point-absence of news about property disputes within Parsi industrial houses. This is considered a crucial reason for their success, differentiating them from other communities.

Beyond profit-making:

The businesses of Parsishave never focused solely on maximizing profits. They believe in earning profits and then utilizing a significant portion of them for betterment of the society.

The Tata Group, India's largest business conglomerate, was founded by Jamsetji Tata in 1868. From its humble beginnings in textiles, hotels, and ironworks, it has established a presence in diverse sectors like IT and automobiles. The Tata Group's contributions extend beyond industries to education, healthcare, research and development.

Founded in 1897, almost two decades later, the Godrej Group is a leading name in various sectors like consumer goods, furniture and real estate, using cutting-edge technology. Godrej has consistently provided opportunities for a significant portion of the world to reach the top. Before the Tatas and Godrej, the Wadia Group was founded in 1736. Its history is intertwined with modern India. This group began with textiles, later expanding into aviation, beverages, banking, real estate, and other areas.

We can confidently say that Noel Tata will add a unique robustness to the nation-building process.

(The author is Delhi-based senior journalist and writer. He is author of Gandhi's Delhi which has brought to the forth many hidden facts about Mahatma Gandhi)