The impact of the ruling by the National Company Law Appellate Tribunal (NCLAT) was clearly visible on Tata Group stocks on Wednesday as shares of all group entities came off the day’s highs during the fag end of the trading session when the order details emerged in public domain.
Further, most of the group stocks ended the day in the red even as the benchmark Sensex gained 206.40 points to close at a new record high of 41,558.57.
The appellate tribunal, in its 172-page order, restored Cyrus Mistry as executive chairman of Tata Group and termed the appointment of N. Chandrasekaran as executive chairman illegal. The appellate body, however, gave the Tatas four weeks’ time to reinstate Mr. Mistry as the chairman though the diversified business conglomerate has said it will take “appropriate legal recourse.”
“If one notices, shares fell significantly from their ruling prices, hit new lows for the day and then recovered marginally,” said Arun Kejriwal of Kejriwal Research & Investment Services.
“Going forward, one would expect Tatas moving Supreme Court in the matter.
“Meanwhile, stocks should stage a recovery but the recovery could be a little muted considering the matter now becomes legal,” added Mr. Kejriwal.
TCS, the biggest listed entity of the Tata Group in terms of market capitalisation, fell about 1.65% from the day’s high to touch a low of ₹2,152.35. The stock, however, managed to recoup its losses partially to close at ₹2,167.25.
However, Tata Motors, Tata Chemicals, Tata Power Company, Tata Global Beverages and Tata Coffee all ended the day in the red.
Tata Global Beverages, which boasts of brands like Tata Tea, Tetley, Good Earth and Himalayan, among others, was the worst-hit with the stock shedding more than 4%.
During the day it lost nearly 5% to touch a low of ₹305.05, before closing at ₹311.80. Tata Coffee also lost nearly 4% while Tata Motors was down by over 3%, after shedding more than 5% during intraday trades.
Interestingly, Tata Steel managed to buck the negative trend among the group stocks and ended the day with a gain of over 1%.
