The shares of Tata Investment Corp. rise by 18% in five days after N Chandrasekaran’s likely third term at Tata Sons

Shares of Tata Investment Corporation rose 6.43% to Rs 739.75 during Friday’s trading session, extending their rally to a fifth straight day. The stock has risen nearly 18% in the past five sessions, fueled by market speculation that N Chandrasekaran is likely to secure a third term as chairman of Tata Sons.The rally follows strong momentum from the previous session where the stock closed almost 8% higher on Thursday after hitting an intraday high of Rs 727.40 on the BSE – marking a gain of as much as 13% during the day.

The development is significant for Tata Investment Corporation as Tata Sons holds a majority stake of 68.51% in the company, NSE stock data for the December quarter shows. In the December quarter (Q3), the company also witnessed a notable increase in retail investor participation, with its shareholder base growing from 1.57 lakh to 2.35 lakh – adding 78,000 investors, reflecting growing investor interest.

Chandrasekaran’s proposed reappointment would require an exception to the group’s retirement policy, which generally applies to non-executive positions after the age of 65. A similar waiver was granted in 2016 when Ratan Tata succeeded Cyrus Mistry as chairman.

Earlier, Tata Trusts – the majority shareholder of Tata Sons – had unanimously approved the reappointment of Chandrasekaran to an executive position in October last year. Additionally, the top management of Tata Consultancy Services (TCS) is expected to present its artificial intelligence strategy to the Tata Sons board next week, adding a new layer of strategic importance to the upcoming board discussions.

Valuation and technical indicators

From a valuation perspective, Tata Investment Corporation trades at a price-to-earnings (P/E) ratio of 85.94, indicating premium valuations compared to broader market averages. However, the price-to-book ratio (P/B) is 0.11.

On a technical level, the stock’s 14-day Relative Strength Index (RSI) is at 63, indicating strong momentum, but still below the overbought threshold of 70. An RSI below 30 is generally considered oversold, while levels above 70 indicate overbought conditions. Furthermore, the stock is trading above seven of the eight simple moving averages (SMAs), reflecting an ongoing bullish trend.

According to the stock ownership pattern of the last quarter of December, foreign portfolio investors (FPIs) have marginally reduced their holdings from 2.69% to 2.54%. Meanwhile, mutual funds have slightly increased their holdings from 0.11% to 0.12% over the same period.

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