Chola Investment shares plunge 7% on reports of Vellayan Subbiah’s exit in Murugappa family settlement

Shares of Cholamandalam Investment and Finance Company tumbled more than 7% on Thursday following reports that Murugappa Group scion Vellayan Subbiah has reached an agreement with other promoter family members to restructure ownership across key group entities.

Reacting to the news, the stock fell as much as 7.18% to ₹1,628.45 on the BSE. It later pared most of its early losses to trade 2.3% lower at ₹1,713.55, valuing the company at a market capitalisation of ₹1.45 lakh crore. Trading volumes were elevated, with 1.36 lakh shares changing hands in the first two hours, nearly three times the two-week average of 0.48 lakh shares.

Last month, the stock touched a 52-week high of ₹1,831.80 on January 6, 2026, rebounding nearly 35% from its 52-week low of ₹1,358.75 recorded on April 7, 2025. It has delivered returns of 19% over the past year, 16% in six months, and nearly 5% in the past month.

The settlement will see Subbiah reduce his stake exposure in Cholamandalam Investment & Finance and instead deepen his holding and influence in Tube Investments of India and CG Power and Industrial Solutions, according to a Moneycontrol report.

The understanding, reached after more than two years of discussions, is part of a broader family-led effort to divide ownership of the over century-old Murugappa conglomerate among three promoter groups while ensuring operational continuity, the report said.

As part of the realignment, Subbiah is expected to step back from the group’s flagship lending business and consolidate his position in Tube Investments and CG Power, potentially by assuming or retaining promoter-linked stakes in these companies within the wider family structure.

The latest shareholding pattern available on the BSE shows that shares of Cholamandalam Investment and Finance Company are predominantly held by the Murugappa family and its affiliated entities, with the promoter and promoter group collectively owning about 49.7% of the company’s equity.

The single largest shareholder is Cholamandalam Financial Holdings Limited, which owns over 44% stake. Another key promoter entity, Ambadi Investments Limited, holds around 4% of the company.

Apart from corporate holding companies, several members of the Murugappa family directly hold small individual stakes. Among them are M A Alagappan, Arun Alagappan, A Venkatachalam and V Narayanan, each owning minority positions. Various family trusts, including Saraswathi Trust and Shambho Trust, also feature in the shareholding pattern.

In a separate development, the company on February 23 informed exchanges that it raised ₹1,000 crore by allotting 100,000 unsecured, subordinated, redeemable listed NCDs. The seven-year securities were issued via private placement on the NSE Electronic Bond Platform (EBP) and carry a fixed annual coupon rate of 8.66%, with maturity scheduled for February 23, 2033.

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