FPIs have pared stakes across several Tata companies with the sharpest reduction seen in premium growth-oriented businesses that had witnessed strong valuation rerating during the post-pandemic rally.
FPI holding in Trent fell from 26.6 per cent in September 2024 to 15.6 per cent in March 2026. Tata Consumer Products saw FPI holding fall from 24.4 per cent to 20.8 per cent, while Tata Consultancy Services’ FPI holding fell 3 percentage points to 9.7 per cent. Tata Motors’ Passenger Vehicles’ FPI shareholding fell to 17.3 per cent from 20.5 per cent, while that of Indian Hotels fell to 23.2 per cent from 27.4 per cent.
Sharp reduction
The sharp reduction in foreign ownership coincided with steep market-cap erosion across several Tata companies. saw its market cap decline nearly 70 per cent since September 2024, while lost more than 66 per cent of its value. , Trent, and also witnessed market-cap erosion of around 50 per cent or more during the period.
Among the top Nifty 50 companies by market cap, FPI holding in declined from 20.8 per cent in September 2024 to 18.3 per cent in March 2026, and market cap declined around 8.8 per cent to ₹18.9 lakh crore, according to Prime Database data. saw foreign ownership fall from 41.5 per cent to 38.1 per cent and market cap fell by 15 per cent, which was largely triggered after the recent resignation of its Chairman raising governance concerns. In contrast, benchmark heavyweights such as and saw relatively stable foreign ownership and materially lower market-cap correction during the period.
“Long-term investors such as pension funds do look at succession planning and governance metrics, while there are other momentum funds that do not look at governance at all,” said Shriram Subramanian, founder and MD of InGovern Research Services.
Opposite approach
Retail investors, however, appear to have taken the opposite approach in several Tata companies. Retail shareholding in Tejas Networks rose sharply during the period, while Tata Technologies, Tata Motors Passenger Vehicles, TRF and Nelco also witnessed increased retail participation despite continued FPI selling.
The Tata group stocks have been under a long consolidation phase, with the current turbulence with Tata Sons’ listing and governance concerns weighing on investor sentiment, said Kranthi Bathini, equity strategist at Wealthmills Securities. “The governance issues are surprising at the board level but the operating companies are expected to remain fundamentally strong over the medium to long term,” he said.