Tata Chemical Shares Surge 14% to All-Time High Amidst Tata Sons Listing Buzz in 2024

Tata Chemical shares have witnessed a remarkable surge of over 14% in intraday trading, reaching a historic high amid reports surrounding the potential listing of Tata Sons. The stock has sustained an upward trend for the past six sessions, accumulating a notable 44% increase during this period. Speculation about Tata Sons, the parent company of the Tata Group, considering a listing on domestic stock exchanges has fueled this surge.

In this recent rally, Tata Chemical reached an unprecedented peak of ₹1,349.70, with a market capitalization of ₹34,136 crore. Trading volumes soared, exceeding 28 lakh shares, a significant spike compared to the two-week average of 2.99 lakh stocks.

Over the past year, Tata Chemical shares had exhibited a limited range, hitting a low of ₹922.20 on April 19, 2023. However, this month has seen a surge in momentum, primarily attributed to the growing anticipation of Tata Sons' potential listing, in which Tata Chemicals holds a 3% stake.

Reports suggest that the Reserve Bank of India (RBI) classified Tata Sons as an upper layer NBFC last year, necessitating the company's listing by September 25, 2025. Analysts predict that the listing could simplify the intricate holding structure of the Tata Group and potentially enable the liquidation of holdings within the conglomerate.

Midas Equities and Research have highlighted the transformative impact of this event, emphasizing that it might trigger a re-rating. The report anticipates a valuation of around ₹11 lakh crore for Tata Sons, with an estimated IPO size of ₹55,000 Crore. While approximately 80% of Tata Sons' holdings may not be immediately monetizable, the restructuring process is expected to unlock substantial value for shareholders.

The shareholding pattern of Tata Sons reveals significant ownership by Dorabji Tata Trust (28%) and Ratan Tata Trust (24%). Tata Motors and Tata Chemicals hold 3% each in the holding company, with Tata Power and Indian Hotels owning 2% and 1%, respectively. Sterling Investment Corporation and Cyrus Investments, led by the Cyrus Mistry family, account for 9% each. The anticipated listing of Tata Sons is poised to create value for shareholders, particularly considering the substantial ownership Tata Sons holds in Tata Chemicals, constituting nearly 80% of the company's overall market capitalization.

Midas Equities further notes that the intrinsic valuation of Tata Chemicals, calculated at 11x FY25 PE, could experience a potential re-rating if the investment is liquidated post IPO, aligning with the valuation assigned to Tata Sons.

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