The market capitalisation of Tata Group companies has nearly tripled during the first tenure of N Chandrasekaran as the Chairman of Tata Sons.
The Group on February 11 extended the term of Chandrasekaran as the Chairman of the multi-billion dollar conglomerate five years after he was first appointed.
The total market capitalisation of the listed entities of the group has risen by 183 percent in the five-year period starting February 2017 to Rs 23.8 lakh crore, making it the highest valued Indian conglomerate, data from AceEquity showed. In the same period, the Nifty 50 index has risen 97 percent.
In the five-year period prior to Chandrasekaran's appointment, the market capitalisation of listed Tata Group companies had risen 100 percent to nearly Rs 8 lakh crore.
The biggest gainers in terms of market capitalisation during the five-year period were Tata Teleservices, Tata Elxsi, Tata Consumer Products, Titan Company, Tata Steel, and Tata Consultancy Services.
Tata Elxsi’s market capitalisation surged 976 percent in the five-year period to Rs 47,352 crore. TCS, which accounts for 58 percent of the Group’s market value, saw its market capitalisation rise by 200 percent in the same period to Rs 13.95 lakh crore.
Much of the upswing in the fortune of the Group can be traced back to the ongoing bull market in the Indian equity market since the beginning of the COVID-19 pandemic.
Further, the rise in global commodity markets since the beginning of the pandemic owing to a supply crunch and depleting inventories has brought investors back to many of the 'old economy' stocks that are part of the Group, analysts said.
Tata Steel, for example, has seen its market capitalisation swell by 286 percent to Rs 1.52 lakh crore under Chandrasekaran’s tenure with the majority of those gains coming during the pandemic period as the company benefitted from a rise in global steel prices.
Among the disappointment of Chandrasekaran's tenure has been the performance of Tata Motors. Shares of Tata Motors have risen merely 20 percent in his first term as chairman reflecting the ongoing concerns over the company’s subsidiary Jaguar Land Rover. That said, Tata Motors' stock has risen substantially in the past 18 months after the company announced plans to go net debt-free in the coming years.
Only two stocks gave negative returns in Chandrasekaran’s reign, these were the differentiated voting rights of Tata Motors which fell 20 percent, and TRF, which fell 36 percent.
