Minority interest, also called non-controlling interest, represents the portion of a subsidiary company's equity that is not owned by the parent company. When a parent company owns more than 50% but less than 100% of a subsidiary, it consolidates the subsidiary's full financial statements into its own consolidated accounts — but must separately report the share of assets, liabilities, and net profit attributable to the minority (non-controlling) shareholders of the subsidiary. In India, minority interest is reported as a separate line item on the consolidated balance sheet (within equity, after the parent's shareholders' equity) and as a deduction in the consolidated income statement when calculating profit attributable to the parent's shareholders. For investors analysing Indian conglomerates — such as Tata Group, Mahindra, or Reliance — minority interest is significant when subsidiaries are partially listed (for example, Tata Consultancy Services within Tata Sons). Ignoring minority interest when calculating earnings per share or return on equity can lead to overestimation of returns attributable to the parent company's shareholders.
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