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New Delhi: Reserve Bank of India Governor Sanjay Malhotra has reiterated that non-banking financial companies (NBFCs) classified in the upper layer must list on stock exchanges, keeping the spotlight on Tata Sons and its efforts to avoid a public listing.
Speaking at the NDTV World Summit in New Delhi on Friday, Malhotra said companies that qualify as core investment companies and have direct or indirect access to public funds must register with the central bank. If classified in the upper layer, they are required to list, he said.
Although the governor did not make a specific ruling on Tata Sons during his remarks, he referred to the regulatory principles governing large financial entities that sit at the top of corporate groups. Such companies can raise or leverage funds through their subsidiaries and other group businesses, creating potential risks for the wider financial system.
Tata Sons, the holding company of the Tata Group, was classified as an upper-layer NBFC in September 2022. Under the applicable rules, it was required to list within three years. Instead, the company repaid its outstanding debt and applied in March 2024 to surrender its registration as a core investment company.
The RBI rejected that application in September 2026, leaving Tata Sons subject to the regulatory framework and its associated listing requirements.
The issue has exposed differences within the Tata Group. Tata Trusts, which collectively hold about 66 per cent of Tata Sons, oppose a public listing and have proposed restructuring measures that they believe could change the company’s regulatory status. The proposal includes merging two group companies into Tata Sons and would require the relevant approvals.
The Shapoorji Pallonji Group, which holds a significant minority stake, has supported a listing. The RBI’s latest remarks reinforce the regulator’s position, though Tata Sons’ eventual course will depend on the applicable rules and any regulatory decisions.