Stocks of major Tata Group companies fell in the range of 1% to 5% on Tuesday after Cyrus Mistry was removed as chairman of India’s largest conglomerate. As a result, 26 of the group’s listed companies lost `10,877 crore in combined market capitalisation.
The market valuation of TCS fell most among the group companies with a fall of `5,754 crore to `4,73 lakh crore, followed by Tata Motors which lost `1,758 crore to `1.78 lakh crore.
While Tata steel lost `1,039 crore of its market value, Tata communications and Indian Hotels lost `430 crore and
`406 crore, respectively.
Commenting on the occasion, analysts at Edelweiss recently said, “We do not expect any meaningful downside in the stock price due to this event as Chandrasekaran was fairly independent and had been running TCS for many years prior to Mistry coming on board.”
On Tuesday, shares of Tata Metaliks opened the trading session 7.62% down from its previous close where as the stock of Tata Steel opened 3.5% lower than its last closing price. Other Tata group companies like Tata Communication, Tata Global Beverages, Tata Motors and Tata Chemicals opened the session between 2% and 4% lower than their previous close.
Shares of Tata Metaliks ended the trading session down around 5% followed by Automotive Stampings and Assemblies whose shares were down 3.2%. Shares of other companies like Indian Hotels, Tata Sponge Iron, NELCO, Tinplate Co and Tata Coffee were down between 2% and 3%. Analysts at Edelweiss said that, “We believe that over the short term the markets may see a knee jerk reaction to this development but the group will readjust due to availability of abundant leadership at group firms.”