The Reserve Bank of India’s latest draft guidelines tightening the regulatory framework for upper-layer NBFCs (NBFC-UL) have left the status of Tata Sons exactly where it was in September 2025 when the deadline for its listing lapsed. The regulator had subsequently said that Tata Sons can keep operating until its registration is legally cancelled, thus easing immediate regulatory pressure. Six months later, the uncertainty continues despite the draft guidelines.

Tata Sons had formally approached the RBI in 2024 seeking to surrender its registration as a core investment company (CIC), but the banking regulator has yet to respond. In recent months, Vijay Singh and Venu Srinivasan of Tata Trusts have voiced support for listing Tata Sons, while Chairman Noel Tata is understood to favour maintaining the status quo.

Under existing regulations, CICs that do not hold public funds—such as loans, debentures, or commercial paper—are eligible to seek deregistration from the RBI, and the latest draft guidelines continue to allow for this.

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What do experts say?

Pratish Kumar, Partner at JSA Advocates & Solicitors, said that although the regulatory route to deregistration remains available, its viability is far from assured. “Regulatory permissibility and regulatory acceptance are not the same. While the pathway exists, whether it is feasible or strategically sustainable is a separate question,” he said.

A major complication is that Tata Sons has already been classified as an NBFC-UL by the RBI, bringing it under stricter regulatory oversight for at least five years from the date of classification—even if it subsequently falls outside the qualifying criteria.

There is, however, a limited precedent. In May 2023, the RBI deregistered Shanghvi Finance after it met the conditions for CICs that do not require registration.

Even so, the broader regulatory mood appears to have firmed up. “North Block and the RBI seem aligned, which explains the clarity on asset-based criteria,” said a corporate lawyer at a domestic firm. “Earlier, there was some subjectivity, but now the rules are unambiguous. Any NBFC with assets above ₹1 lakh crore automatically falls into the upper layer.”

Nazneen Ichhaporia, Partner at ANB Legal, noted that the draft guidelines offer no specific exemption for CICs. “The absence of a carve-out means the asset-based criteria continue to apply,” she said.

“In the absence of RBI approval for deregistration, Tata Sons may have no option but to pursue a listing,” she added. With assets estimated at around ₹1.75 lakh crore, a sharp reduction in the balance sheet appears highly unlikely.

While the proposed NBFC-UL regime does not entirely foreclose the possibility of Tata Sons avoiding a mandatory listing, the room for manoeuvre is clearly shrinking.