In part due to their 18.37% stake in Tata Sons, state-owned Power Finance Corp (PFC) has requested legal counsel over the granting of a ₹15,000 crore loan to the proprietors of the Shapoorji Pallonji (SP) Group. According to persons with knowledge of the situation, the promoters, the Mistry family, had approached the lender earlier this year with a proposition for loans against cash flows from the group's real estate sector and the Tata Sons holding. Through family-owned investment companies, the Mistrys are the stakeholders.

According to the sources quoted, state-owned PFC has consulted with two independent legal firms to determine if a non-banking financing company (NBFC) may provide a loan secured by unlisted shares. The stock of Tata Sons is not listed and is privately held. The holding company of the Tata Group is 66% owned by the Tata Trusts.

While lending against shares of listed businesses is governed by the Reserve Bank of India's (RBI) master directives governing non-bank financial institutions (NBFCs), there is no mention of unlisted stock in them.

First reported by ET on February 21, the Mistrys had applied for loans from PFC and Deutsche Bank to settle the debt that was raised three years prior. Bonds that were sold to credit funds and are scheduled for redemption in June represent that obligation.

Questions received no response from PFC or SP Group. Tata Sons chose not to respond.

Once close allies, the SP Group and the Tata Group soured when the late Cyrus Mistry was removed from his position as chairman of Tata Sons in October 2016. The Mistry family's ownership stake in Tata Sons has been a source of conflict ever since. Due to financial difficulties, the gap has widened for the SP Group.