Business & Finance

RBI Governor Clarifies Tata Sons Must List as Upper‑Layer NBFC

By Reeba Zachariah

In Mumbai, RBI Governor Sanjay Malhotra confirmed that Tata Group’s holding company must be listed publicly while it remains an upper‑layer non‑banking financial company (NBFC) and core investment company (CIC). The statement follows the central bank’s September 11 order that rejected Tata Sons’ request to deregister as a CIC and directed it to comply with UL‑NBFC regulations. Malhotra said that NBFCs and CICs, such as Tata Sons, are required to be registered because of systemic risks, and that an upper‑layer entity must also be listed. He added that the RBI requires UL‑NBFCs with assets over Rs 1 lakh crore, or with direct or indirect access to public funds, to list. Tata Sons, whose assets were Rs 2.01 lakh crore as of March 31, 2026, exceeds this threshold. The governor implied that Tata Sons is in breach of RBI rules, though the consequences of continued non‑compliance are unclear. He declined to comment on Noel Tata’s proposal to merge two Tata Sons subsidiaries with the holding company to avoid a listing. The Tata Sons board met on September 17 to discuss the RBI letter and agreed to comply with the regulator’s directives, but did not decide on a listing. Noel Tata, a director of Tata Sons and chair of Tata Trusts, argued that the RBI’s communique does not explicitly mandate a listing and that the board had not formed a view on the legal effect of the communication. The RBI first classified Tata Sons as a UL‑NBFC in 2022 and required it to list within three years. The holding company had sought to avoid a market debut by surrendering its CIC registration after reducing its debt to zero, but the central bank rejected the request, stating it could not be acceded to.