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Cyrus Mistry. Photo: Mint
Cyrus Mistry. Photo: Mint

Tata group companies trade mixed post NCLAT order on Cyrus Mistry ouster

  • NCLAT also ordered that Cyrus Mistry be restored as executive chairman of Tata Sons
  • In a surprise move on 24 October 2016, Mistry was removed as chairman of Tata Sons

Shares of Tata group companies traded mixed on Thursday following an appeals court holding illegal the appointment of N Chandrasekaran as chairman Tata Sons. The National Company Law Appellate Tribunal (NCLAT) on Wednesday also ordered that Cyrus Mistry be restored as executive chairman of Tata Sons in lieu of Chandrasekaran although the implementation of this has been suspended for four weeks.

The company has the option to challenge the ruling in the Supreme Court.

While shares of Tata Motors and Tata Consultancy Services rose 1% each today, Tata Metaliks was up 0.7%, Nelco Ltd advanced 0.4%, Voltas, Tata Chemicals and Tata Investment Corp were 0.08-0.2% higher. On the other hand, Tata Steel Ltd fell 0.9%, Rallies India 0.6%, Titan Co Ltd was down 0.5%, Tata Power Co 0.5%, Tata Global Beverages ltd 0.3%, Trent Ltd 0.2%, Tata Elxsi 0.3%, Tata Coffee Ltd 0.3%.

According to a Mint report, with the appellate tribunal ruling in favour of ousted Mistry, the odds have changed dramatically for the diversified conglomerate. This is likely to show in weakened investor confidence and potentially higher cost of capital until there is clarity on the final outcome of the ongoing legal tussle.

The order casts uncertainty over Chandrasekaran’s plans to simplify the group’s structure, revive growth, cut costs and invest in future growth areas.

In a surprise move on 24 October 2016, Mistry was removed as chairman of Tata Sons and later also ousted as a director from the holding company's board.



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