Shares of Tata Investment Corporation hit a record high of Rs 2,072.15 on the BSE as the shares rose 6 percent in intraday trading on Tuesday. In the past two weeks, shares in the Tata Group company have soared 29 percent. In the past month, it rose 39 percent, compared to a 1.8 percent rise in the S&P BSE Sensex.
Tata Investment Corporation is a non-bank finance company (NBFC) promoted by Tata Sons. The company is registered with the Reserve Bank of India under the category of Investment Company. It is engaged in the business of investing in debt instruments of listed and unlisted shares of companies in a wide range of industries and in mutual funds.
The company’s main sources of income consist of dividend income and gains on the sale of investments. The company together with Tata Sons is a promoter of the Tata Mutual Fund. The company is also the main shareholder in Tata Securities Ltd, a company engaged in the distribution of mutual funds and other investment-related securities.
For the April-June quarter (Q1FY23), Tata Investments had reported a stand-alone profit after tax (PAT) of Rs 89.74 crore, against Rs 53.89 crore in Q1FY22. It had posted PAT of Rs 20.23 crore in the previous quarter (Q4FY22). The healthy profit growth was due to higher dividend income of Rs 74.19 crore in Q1 2020, compared to Rs 41.26 crore in Q1 2022 and Rs 17.55 crore in Q1 2022. fourth quarter of 2022.
Tata Investment posted a 38 per cent appreciation in its NAV in FY22 and made a profit of Rs 430.61 crore on equity investments (after tax) taking advantage of buoyant markets. Going forward, performance will depend on how global factors, the economy and corporate earnings develop during the second half of the year, the company said.
Tata Investment said that the company aims to continue investing in leaders in sectors, which they believe have the potential to continue accumulating value in the medium and long term. The company further said it continues to invest for the long term while taking advantage of profit opportunities to increase operating income for dividend distribution.
The company invests in Tata and non-Tata companies, both listed and unlisted, although investments in Tata companies make up a larger portion and can be considered long-term and strategic in nature. The company strives to assess opportunities and invest considering macroeconomic conditions both globally and domestically, Tata Investment said in its FY22 annual report.
“The company will continue to seek opportunities to invest in companies that have growth prospects consistent with high-quality earnings. In new age companies where valuations are a concern and whose earnings will bear fruit at a later stage of their development, the Company has made a small allocation of capital,” the company said.
He also said that the Company will continue to allocate its capital between listed shares, fixed income and unlisted shares. Management will evaluate and select investments based on high-quality governance, long-term sustainability and the strength of the investee company’s balance sheets.