Mumbai, (Maharashtra) [India] September 28 (ANI): The Reserve Bank of India (RBI) is watching the developments unfolding at Tata Sons even as it awaits an official word from the company on the plans for compliance as an upper layer NBFC.
According to sources, Tata Sons has conveyed to the central bank that it will expedite the process and work towards complying with the RBI’s directive. The company’s board, at its September 17 meeting, had resolved to initiate the process for listing the holding company.
Sources said the Tata Sons board is expected to finalise its response to the RBI, including a broad timeline for undertaking the listing process.
There have also been reports that Tata Sons Chairman Noel Tata has asked the company to explore a corporate restructuring that could potentially help avoid a listing as part of the compliance process.
According to the reports, the apparent proposal involves splitting Tata Sons into smaller holding companies, with the objective of bringing the entities below the threshold prescribed under the RBI’s definition of an Upper Layer NBFC.
“Any such proposed restructuring will be seen as an effort of avoidance and will not go down well. We want Tata Sons to comply and a listing exercise should be undertaken at the earliest,” an RBI official told ANI on condition of anonymity.
The development follows the RBI’s rejection of Tata Sons’ application seeking surrender of its registration as a Core Investment Company (CIC). Tata Sons had applied for deregistration in March 2024 after repaying more than Rs 21,000 crore of debt and seeking to move out of the regulatory framework applicable to NBFCs.
However, the RBI subsequently directed the company to comply with the regulations applicable to NBFCs classified under the Upper Layer category.
Tata Sons has been classified as an Upper Layer NBFC since September 2022. Under the RBI’s scale-based regulatory framework, entities in this category are required to meet specified regulatory requirements, including listing within the prescribed timeframe.
Sources said Tata Sons has exchanged extensive correspondence with the RBI on the regulatory and listing-related issues.
The company’s three-year deadline for listing as an Upper Layer NBFC expired in September 2025 without Tata Sons going public. The regulatory issue has since brought the listing question back to the centre of discussions within the company.
The listing issue has emerged as a point of difference between Tata Sons and Tata Trusts, which collectively control around 66 per cent of the holding company.
At the September 17 board meeting, Tata Trusts Chairman Noel Tata reiterated the position that Tata Sons should remain privately held. Tata Trusts had sought to keep the holding company private while exploring options for providing an exit to the Shapoorji Pallonji Group, a significant minority shareholder in Tata Sons.
The Shapoorji Pallonji Group, which holds around 18.37 per cent in Tata Sons, has favoured listing as a route to unlock value from its holding and facilitate fund raising against its stake.
The RBI had earlier rejected Tata Sons’ attempt to surrender its registration and directed the company to comply with the applicable regulatory requirements. The latest correspondence from the central bank has therefore put the focus on how Tata Sons intends to meet those requirements and whether it will proceed with a listing.
The company had reported total assets of around Rs 2.01 lakh crore as of March 31, 2026, placing it above the Rs 1 lakh crore asset threshold cited under the RBI’s Upper Layer framework. (ANI)
RBI awaits Tata Sons’ formal response on Upper Layer NBFC compliance
