Why the Tata Group fared the worst among giants in 2025

Summary: This deep dive breaks down where the Tata Group lost ground in 2025, which businesses dragged the most, and why some parts of the empire still offer resilience.

2025 was another muted year for Indian equities. The benchmark Sensex managed a modest 9 per cent gain, more or less similar to that of the year before. However, performance diverged sharply across sectors, and even more starkly across India’s largest corporate groups.

Among the country’s biggest conglomerates—companies that collectively shape market direction, investor sentiment and index movements—some groups extended their dominance with strong gains, while others faltered despite their size and pedigree. Most striking of all was the underperformance of the Tata Group.

Among India’s 10 largest business houses by market capitalisation, the Tata Group ended the year at the bottom of the leaderboard.

According to data compiled by Mint, the top 10 accounted for nearly 24 per cent of India’s Rs 474 lakh crore market capitalisation as of December 26, 2025, broadly unchanged from the previous year. But within that stability lay a sharp reshuffling of fortunes.

At one end, the Aditya Birla Group topped the table with a 26.2 per cent rise in combined market value, followed by the Bajaj Group (25.5 per cent) and Reliance Industries (24 per cent).

At the other end sat the Tata Group, whose aggregate market capitalisation fell 15 per cent over the year, making it the weakest performer among India’s corporate heavyweights. The Godrej Group was the second worst with an 8 per cent decline, the report showed.

The big culprit

The biggest drag on the Tata Group’s performance likely came from its crown jewel: Tata Consultancy Services (TCS). Accounting for roughly 44 per cent of the group’s total market capitalisation, TCS alone fell 22 per cent in 2025—its worst yearly performance since 2008’s global financial crisis when the stock plunged 56 per cent, according to Moneycontrol.

A prolonged slowdown in global technology spending, especially among large US and European clients, kept revenue growth muted. Discretionary IT budgets were slashed as global enterprises delayed digital transformation projects amid economic uncertainty. Market observers point to slowing deal wins amid a cautious outlook from management as key reasons behind the stock’s underperformance.

Other weak links in the chain

TCS was not alone. Tata Motors Passenger Vehicle (formerly Tata Motors) and retail giant Trent, both with sizable market cap share, saw the highest losses. Shares of Tata Motors Passenger Vehicle slid nearly 50 per cent during the year, hit by slowing demand, rising competition in the EV space, and concerns around margin sustainability after a period of rapid expansion.

Trent, which had enjoyed a multi-year rerating on the back of aggressive store expansion and strong fashion retail growth, saw its stock correct sharply by around 40 per cent as valuations concerns overshadowed earnings visibility. Investors began pricing in execution risks and the possibility of slower discretionary spending.

In total, 18 of the Tata Group’s 24 listed companies ended the year in the red.

The bright spots

Not everything in the Tata stable struggled. A handful of companies managed to outperform the broader market with sizable outperformance, offering pockets of resilience amid the gloom. Tata Steel, Tata Consumer Products, Titan and Indian Hotels delivered solid market-beating returns, helping cushion the broader downturn. But their gains did not suffice to offset losses caused by the group’s heavier constituents.

For investors, the lesson is that even the most admired conglomerates need to be assessed with a cold eye—stock by stock, cycle by cycle. Understanding where value is genuinely rebuilding, and where it merely appears cheap, is what separates conviction from complacency.

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