Calmer Tone, Tough Questions: Inside Tata Sons' Special Board Meeting

The Tata Sons board meeting on May 26 was notably more peaceful than recent gatherings, with group company CEOs making detailed presentations before the board, including Tata Trusts chairman Noel Tata, according to an Economic Times report. The discussions were described as constructive and largely free of conflict.

This was the first time in Tata Sons' history that a special board meeting was called by its chairman specifically to present a business review to the Tata Trusts chairman, the report said.

A Tense Few Months

The meeting had been closely watched, coming after months of publicly aired differences at the top of the Tata Group.

At the previous board meeting on February 24, Noel Tata had raised concerns about high-risk investments, losses in newer businesses, an exit option for the SP Group and Tata Sons' unlisted status. He had also called for a separate discussion with chairman N Chandrasekaran on these matters.

Point to note: Tata Trusts, which holds a 66% stake in Tata Sons and can nominate one-third of its board members, has been at the centre of these tensions. Noel Tata has served as its chairman since October 2024, following the death of Ratan Tata.

The Monday meeting largely addressed the concerns Noel Tata raised in February, covering performance, future growth and capital requirements for newer businesses including electronics and aviation.

Ahead of the board session, Noel Tata and Chandrasekaran had met separately on May 22 to discuss some of these high-stakes issues.

Air India, BigBasket in the Spotlight

Much of Noel Tata's attention during the meeting was focused on Air India and BigBasket, with both businesses drawing major discussion on operational performance, investment needs and the path to profitability, the report said.

Air India has been under pressure, having reported a net loss of around ₹10,859 crore in FY25. Losses are expected to widen further in FY26 due to restructuring and aircraft upgrade costs, according to previous reports.

Tata Electronics, on the other hand, emerged as a bright spot. The board was said to be impressed by the company's rapid growth and its expanding role in the group's manufacturing and technology plans.

The CEOs who made presentations included Randhir Thakur of Tata Electronics, Campbell Wilson of Air India and Sajith Sivanandan of Tata Digital. Thomas Flack, CEO of Agratas, and Kumar Sivarajan, CTO of Tejas Networks, also attended, though their businesses did not figure in the main discussions.

Chandrasekaran outlined the long-term strategy and investment rationale behind the group's newer bets.

Two Big Questions Skipped

Two of the most contentious issues — a possible Tata Sons listing and Chandrasekaran's reappointment for a third term — did not come up at the meeting, as per ET.

The listing issue has been a sensitive one for years. In September 2022, the Reserve Bank of India classified Tata Sons as an upper-layer Non-Banking Financial Company under its Scale-Based Regulation framework, requiring the company to list by September 2025. However, Tata Sons later disclosed that it had surrendered its registration as a Core Investment Company and sought exemption from the mandatory IPO requirement.

Group watchers said it remains to be seen whether the calmer tone sets the mood for the next board meeting, which may take up Chandrasekaran's reappointment.

"There is a surprise development coming up every other week in recent months in the group, so it is still a wait-and-watch situation," a senior group executive was quoted as saying by ET.