SHAPOORJI PALLONJI GROUP: TO HELL & BACK

HOW SHAPOOR MISTRY IS RESTRUCTURING SHAPOORJI PALLONJI GROUP TO IMPROVE OPERATIONAL EFFICIENCY AND REPAY DEBT.

- NEVIN JOHN

THE MISTRY FAMILY has learnt from adversities that their pains contract as much as they stay together. In 2022, the family faced a double loss: 54-year-old Cyrus Mistry died in a road accident in September 2022, three months after his father Pallonji Mistry passed away at 93. The offices formerly occupied by Pallonji and Cyrus Mistry in group headquarters at Minoo Desai Marg in Colaba, South Mumbai, have been left vacant as a mark of respect. Cyrus, along with elder brother Shapoor, was in the midst of unbundling the 158-yearold Shapoorji Pallonji (SP) group to improve operational performance and re-engineer financials to lower debt, which touched ₹45,000 crore in March 2020, mainly due to high-cost construction projects and working capital shortage during Covid 19 pandemic. The family raised funds by pledging the family jewel-its 18.37% stake in Tata Sons-to raise ₹26,000 crore. The stake is equally divided between Sterling Investment Corp. Pvt. Ltd. and Cyrus Investment Pvt. Ltd. (both holding companies are equally owned by families of Shapoor and Cyrus). Mistrys want to get the shares released within next three years by using cash flow from group companies. The intrinsic value of the stake would be over 10 times the loan as Tata Sons' promoter holding in top 15 Tata companies such as TCS, Tata Motors, Tata Steel and Titan was worth ₹16.3 lakh crore in first week of March.