Tata Group on Tuesday told the Supreme Court that the valuation of 18.4 per cent stake of Shapoorji Pallonji (SP) Group in the holding company is worth between Rs 70,000 crore and Rs 80,000 crore. The valuation of SP Group’s stake determined by the salt-to-software conglomerate in Tata Sons Ltd. is less than half of Rs 1.78 lakh crore sought by the Mistry family-controlled SP Group.
Senior Counsel Harish Salve from the side of Tata group told the Supreme Court bench headed by Chief Justice S.A. Bobde that the group’s estimated value is far lower than what has been claimed. He said, “As per our calculations, the Pallonji Group shareholding in Tata Sons is worth not more than Rs 70,000 crore to Rs 80,000 crore.”
Salve said that the company has been “run amazingly”, between 1991 and 2012 increasing the market cap of Tata Group by up to 500 times. However, the apex court bench referred to the records and said the 18.37 per cent stake of SP Group was valued at Rs 58,000 crore in March 2016.
SP Group submitted that the dispute regarding the overvaluation can be eliminated by doing a pro-rata split of listed assets (value of share price is known) and pro-rata share of the brand (brand valuation) and added, a neutral third-party valuation can be done for the unlisted assets adjusted for net debt. This lead to a potential delay in the resolution could hinder the plans of cash-strapped SP Group to pare debt.