After being rocked by the sacking of its chairman Cyrus Mistry and the alleged washing of dirty linen in public by the letter that he wrote to Tata directors which purportedly hinted at many wrongdoings in the conglomerate and even at the loss of $18 bn in value, the National Stock Exchange (NSE) stepped into the imbroglio and asked 6 Tata companies to clarify its former chairman’s remarks over the same.
This comes in the wake of Tata group stocks like Tata Consultancy Services (TCS), Tata Steel, Titan Company, Tata Communications, Tata Chemicals and Tata Metaliks suffering massive losses second day running. On day 1, that is Tuesday, they fell in the range of 1% to 5% and 26 of the group’s listed companies lost Rs 10,877 crore in combined market capitalisation. Experts have gone ahead and cautioned investors about buying the group companies’ stock even though they have fallen a lot, saying that this may not be an opportunity and that there may be more mayhem in store. On Bombay Stock Exchange (BSE) Tata Steel shares fell by 2.51%, Tata Power 1.5%, Tata Consultancy Services slid 1.20% and Tata Motors by 1.07%. TCS market cap plunged by most by Rs 5,754 cr to Rs 4,73 lakh crore, Tata Motors by Rs 1,758 cr to Rs 1.78 lakh cr.
Now, on Wednesday, Tata group companies have lost some Rs 10,000 cr to take the overall loss to a whopping over Rs 21,000 cr.
With such mayhem hurting the shareholders of the group and hitting overall market sentiment, NSE has chosen to be among the first out of the blocks to ask some telling questions from the Tata group. In fact, in his letter, Cyrus Mistry has made a number of allegations that have huge ramifications for the various companies under their control. He has also allegedly made some allegations against former chairman Ratan Tata too.