When the corporate battle at Tata Sons was being fought out a few months ago, a strange mystery came to light.
In the list of Tata Sons shareholders made public, the Tata Trusts owned 266,610 shares, the Shapoorji Pallonji family owned 74,352 shares, various Tata companies owned 49,365 shares, and members of the Tata family owned a total of 8,235 shares. But among these large chunks of shareholdings there was one single, solitary share that was owned by somebody named Virendra Singh Chauhan of Chota Udaipur.
The question was, who was this unknown princeling, and how did he get to own this one share in Tata Sons?
After all, it was an unlisted company, and its shareholdings were restricted to a small, tight circle of Tata insiders. Even the Shapoorji Pallonji family were considered outsiders, and their acquisition of Tata Sons shares through a series of private deals was resented by the Tata family as an “intrusion.”
There was obviously some interesting backstory to all this. But nobody seemed to know what it was.
Nobody knew who Virendra Singh Chauhan of Chota Udaipur was—or the circumstances in which he came into possession of his Tata Sons shareholding. And, to add to the mystery, there was the puzzling question of why he owned just that one share.
In an effort to solve this mystery, I began asking around. But, frustratingly, people who should have known the answers were reluctant to talk about them, perhaps because the matter was considered controversial while the corporate battle was still raging. Finally though, the pieces began to fall into place.
I discovered that the mysterious Virendra Singh Chauhan of Chota Udaipur—or, to use his real name, Maharawal Virendrasinhji Natwarsinhji Chauhan—was dead. In fact, he had been dead for over 10 years. I managed to track down his son, Jai Pratap Sinhji.
Chota Udaipur was a small princely state in Gujarat, ruled by descendants of Prithviraj Chauhan. Its maharawals—the title given to the rulers—were patrons of art and architecture.
Maharawal Natwarsinhji, the ruler in the 1930s, was evidently a man of the world, admired by his peers for, among other things, the unique 1937 Rolls Royce Phantom that he had custom-built for himself, with a gilded interior, designed to look like a railway saloon so that it created the illusion of travelling by train. The car had a second dashboard specially installed at the back, so that its royal passengers could keep track of its speed and mileage.
When Maharawal Natwarsinhji suddenly died while on holiday in Lisbon in 1946, the title passed on to his son, Virendrasinhji, who was only 11 years old. Thus, during the tumultuous period in 1947 when, along with the other princely states, Chota Udaipur was integrated into independent India, Virendrasinhji was only a minor.
He was educated at Daly College, Indore—the school set up for the princelings of central India—and he grew up to develop an unusual business sense. An issue of the Economic Weekly from the year 1962 describes Virendrasinhji as an “industrialist”, and lists him as a director of National Ekco, a Tata company set up for the manufacture of radios. He was, remarkably, just 25 years old at the time—the same age, coincidentally, as Ratan Tata, who was then just an apprentice at Tata Steel, shovelling limestone and learning to operate the blast furnace.
Virendrasinhji went on, over time, to become the director of various companies, sitting on boards with illustrious industrialists and company directors of the time, like SS Kirloskar, BM Ghia, MS Talaulicar, Navroz B Vakil, the Maharaja of Baroda, and Hasham Premji (father of Azim Premji). But, more significantly, Virendrasinhji—while still in his early 30s—became a director of Tata Mills, chaired by Naval Tata, the father of Ratan Tata. He also sat on company boards with other members of the Tata family, and, thus, over the years, he became a trusted Tata insider.
Virendrasinhji’s role as a company director was mutually reinforced by his role as a socialite and bon vivant, fond of hunting, horses, billiards, racing and cricket, and a member of various clubs in Mumbai and London. He received a privy purse of Rs212,000 a year—a very handsome sum at a time when the managing director of a company typically earned an annual salary of Rs42,000. He also continued to be listed in The Royalty, Peerage and Aristocracy of the World until the time when princely privileges were abolished in 1971.
So, how did he get to own that one mysterious Tata Sons share?
According to his son, Jai Pratap Sinhji, sometime in the 1980s, Virendrasinhji was allotted “twelve or thirteen” shares in Tata Sons because of his close relationship with JRD Tata. The son is not sure of the exact number of shares acquired, nor does he know the circumstances of the transaction. But presumably it was part of some kind of internal tidying up exercise—as sometimes happens in unlisted companies—when a parcel of shares becomes available, and a suitably reliable party is needed to take charge of them. It was thus a mark of the trust the Tatas had in Virendrasinhji that he was selected for this purpose. And, conversely, it was a matter of prestige for him to be able to hold those shares. It was also, incidentally, an investment that would prove to be a huge multi-bagger over the years.
So, if Virendrasinhji was allotted “twelve or thirteen” shares in Tata Sons, how come the records now show that he holds just one share?
According to his son, in 1998, Virendrasinhji was setting up a garment manufacturing business in Bengaluru and he sold his Tata Sons shares to help raise the necessary funds. But when doing so, he was prudent enough to retain one share, so that he would continue to have the rare privilege of being a shareholder of Tata Sons. It was an act that would seem to reflect the Latin motto on the Chota Udaipur coat-of-arms: “Memoria manet”—meaning “The memory remains”.
The other mystery, of course, is that if Virendrasinhji died in 2005, how come the Tata Sons records still show that one share to be in his name?
It turns out that after Virendrasinhji’s death there has been some kind of dispute in the Chota Udaipur family over the succession to the title. While the title should have normally passed to his eldest son, Jai Pratap Sinhji, part of the family seems to have backed the claim of his youngest brother, Aishwarya Pratap Sinhji, for reasons they don’t like to discuss in public. And as a result of this dispute the ownership of Virendrasinhji’s one Tata Sons share is also in dispute, along with various other assets. (The confusion within the family is reflected by the fact that while the official records clearly state that the Chota Udaipur family owns one single Tata Sons share—a fact that would presumably stick unambiguously in one’s mind—Jai Pratap Sinhji thinks they still hold “four or five shares” in the company; he says he’s not quite sure.)
Given this disputed ownership of the share, when it came to the crucial shareholders’ vote on the Cyrus Mistry issue in February, the Chota Udaipur holder was punctiliously recorded as abstaining.
One final question: so how much is the Chota Udaipur family’s one share worth?
Well, it all depends on how you calculate it. The Shapoorji Pallonji family’s holding in Tata Sons has, for instance, been estimated to be worth anything between Rs66,500 crore and Rs90,000 crore. So, going by that, the Chota Udaipur share, with its face value of Rs 1,000, would today be worth anything between Rs89 lakh and Rs1.21 crore.
A share in Warren Buffet’s Berkshire Hathaway, in comparison, trades for about $240,000 (Rs1.59 crore approximately). The difference, however, is that you can buy a Berkshire Hathaway share, if you have the money, but you cannot buy a Tata Sons share.
Unless, of course, you happen to be an insider, like Virendrasinhji Chauhan of Chota Udaipur.
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