The decision was conveyed in a letter dated September 11 after the central bank considered Tata Sons’ March 28, 2024 application and subsequent correspondence, people familiar with the matter said. The RBI advised the company to take the steps needed to comply fully with requirements applying to upper-layer NBFCs.
Tata Sons had sought to give up its Certificate of Registration after reducing debt and arguing that it could operate as an unregistered core investment company. Approval would have removed the principal regulatory basis for a compulsory market listing and allowed the company to remain privately held.
The rejection closes that route. RBI rules require an NBFC classified in the upper layer to list within three years of identification and subject it to tighter standards covering capital, governance, disclosures and risk management. Tata Sons was first placed in the upper layer in September 2022, making its original listing deadline September 2025.
The company remained unlisted while its deregistration request was under examination. When the RBI published its upper-layer list for 2024-25 in January 2025, it retained Tata Sons as a core investment company but said the inclusion was without prejudice to the outcome of the pending application.
The central bank subsequently revised its scale-based framework. Under the current approach, very large NBFCs face enhanced supervision, with an asset threshold of ₹1 trillion among the key criteria. Tata Sons’ standalone assets were about ₹1.75 trillion at the end of March 2025, placing it comfortably above that level. More recent accounts cited in corporate filings and regulatory discussions put the asset base above ₹2 trillion.
The company had repaid more than ₹200 billion of borrowings before seeking deregistration, a step intended to eliminate reliance on public funds, but the regulatory framework also considers circumstances in which access to funding may arise through group entities.
RBI Governor Sanjay Malhotra said in August that entities meeting the applicable criteria continued to fall within their respective regulatory layers. At that stage, Tata Sons’ application to surrender its core investment company registration had not been decided.
The latest communication therefore resolves the central regulatory question that had kept the company’s listing status uncertain. It does not, by itself, set out the structure, timing or size of any share sale, and Tata Sons has not publicly announced an IPO plan following the RBI decision.
A listing would have significant consequences for the ownership of Tata Sons, which sits at the centre of a group spanning technology, automobiles, steel, consumer businesses, airlines and financial services. Tata Trusts collectively hold roughly two-thirds of the company, giving the philanthropic trusts decisive influence over the holding company.
The Shapoorji Pallonji Group is the largest minority shareholder, with an interest of about 18 per cent. A market listing has long been important to the shareholder because it could create a transparent route for monetising part of that holding, while sections of Tata’s controlling shareholder base have favoured keeping Tata Sons private.
The regulatory decision arrives as Tata Sons is also dealing with leadership uncertainty. Chairman N Chandrasekaran has said he will not seek another term when his current tenure ends in February 2027, adding another major governance issue for the board and shareholders to address.
Tata Sons controls or holds substantial stakes in several listed companies, including Tata Consultancy Services, Tata Motors and Tata Steel, while also overseeing unlisted businesses. Its position as the group’s principal holding company means any listing would require extensive work on disclosures, capital structure, shareholder arrangements and regulatory compliance.
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