Mumbai: Tata Group shares will likely remain under pressure until the controversy over Tata Sons chairmanship is resolved, according to analysts.
Shares of Tata Group companies declined substantially from their highs on Wednesday after an appeals court passed the ruling on ousted chairman Cyrus Mistry.The Tata Motors ADR was trading 2.51 per cent lower at $12.45 at 7 pm.
The Tata Motors stock, which was trading higher on NSE, declined 5.3 per cent from its intraday high to close at Rs 174.80, down 3 per cent.
From a days high of Rs 327.40, the Tata Global stock plunged 4.6 per cent to settle at Rs 312.35.
The Tata Steel stock declined 2.5 per cent from the intraday high to close at Rs 444.75, 1.22 per cent higher.The Indian Hotels stock declined 2.88 per cent to close at Rs 145.20 while shares of Tata Chemicals and Tata Power fell 2 per cent and 1 per cent, respectively.The controversy will likely impact Tata Group stocks in the short-term, said analysts.The valuation multiples of Tata Group stocks will come under pressure until the Mistry-Tata controversy is resolved, said Asutosh Mishra, head of researchinstitution, Ashika Stock Broking.
The stocks may underperform if the tussle between the two groups continued.On Wednesday, the NCLAT bench headed by Chairperson Justice S J Mukhopadhaya pronounced its judgment on the matter.
The tribunal had reserved its order earlier in July this year, after completing a marathon hearing on the issue.Earlier, the Mumbai bench of the National Company Law Tribunal (NCLT) had dismissed the petitions filed by the two investment firms, Cyrus Investments and Sterling Investments Corp, challenging Mistry removal.
Later, Mistry also personally approached the NCLAT over the NCLT order.
NCLAT said that the NCLTs earlier order was avoidable.