Cyrus Mistry-Ratan Tata tussle: Investors lose Rs 51,614 cr in 3 days as shares tumble

Following the Ratan Tata-Cyrus Mistry tussle and the sacked chairman of Tata Sons shooting off a damning letter on Tuesday to the company board, several Tata group stocks are in the dock leading to persisting weakness on the bourses over the last three sessions. As things continue to get murkier by the day with the ousted chairman coming out in open alleging discrepancies in several group companies, investors are hastily scurrying for cover in order to trim their losses. [caption id=“attachment_2772580” align=“alignleft” width=“380”]  Reuters[/caption] At 12:30 pm, Tata stocks have fallen up to 9 percent even as the broad market remained flat. Tata Tele Maharashtra was the biggest loser among the pack, tumbling 9.1 percent. Shares of Indian Hotels Corp dropped 5.4 percent, Tata Investment Corporation 5 percent, Tata Global Beverages 4.7 percent and Tata Sponge Iron 3.6 percent. Among the Sensex constituents, Tata Motors fell the most, dropping 2.1 percent to Rs 518.65, even though the company has been one of the two group firms (the other is TCS) which is consistent in delivering robust earnings. Tata Steel and TCS shares were down around a percent each at Rs 395.05 and Rs 2,376.45, respectively. Over the last three sessions, including today’s fall, several Tata shares felt the heat, losing over 4-12 percent each. Tata Metaliks plunged 12.6 percent in three sessions, while Indian Hotels Corp tanked 11.5 percent, Tata Motors slipped 6.7 percent and Tata Communications tumbled 6 percent.  Trent, Nelco, Oriental Hotels, Rallis India, Tata Chemicals, Tata Steel and Voltas were the other laggards, dropping 3-7 percent each during the period under review. In last three sessions, the 27 listed stocks of the group collectively lost Rs 51,614 crore in market capitalisation. Of the lot, Tata Motors took the maximum beating as investors wealth in the counter eroded by a steep Rs 30,018 crore. Other big Tata stock that bore the brunt of investor selling was TCS, which resulted in its m-cap falling by Rs 8,800 crore. Mistry in his letter to Tata board on Wednesday had listed out group companies such as Indian Hotel, Tata Motors PV, Tata Steel Europe, Tata Power Mundra and Tata Teleservices as ’legacy hotspots’. According to him, the fair value of the legacy hotspots would result in a write-down of Rs 118,000 crore. According to analysts, Tata group shares may remain weak for some more time, especially after the outgoing chairman highlighted several worrying factors at several group companies, weighed down by increasing debt level and subdued business proposition.