Tata Motors' long-awaited demerger came into effect on October 14, 2025, which officially split the company's Passenger Vehicle (PV) and Commercial Vehicle (CV) units into two separate businesses. The change in structure, first announced in March 2024, is intended to improve operational focus, release shareholder value, and improve transparency across divisions.
After a special pre-open price discovery session held from 9:00 a.m. to 10:00 a.m., Tata Motors Passenger Vehicles Ltd. shares debuted at Rs. 400 per share on the NSE and Rs. 399 on the BSE. Soon after listing, the stock fell over 5% to Rs. 376.90 on the BSE as investors booked profits.
The record date for the demerger was October 14, and from this date, Tata Motors shares are trading ex-commercial vehicle (CV). Under the approved structure, shareholders will receive one fully paid-up equity share of Rs. 2 in Tata Motors Commercial Vehicles Ltd. (TMLCV) for every one share held in Tata Motors.
Under the new structure, the PV and JLR divisions remain a part of Tata Motors Passenger Vehicles Ltd., whereas the commercial vehicles have gone to TML Commercial Vehicles Ltd.
Within 45-60 days, possibly by mid-November 2025, TMLCV stocks will be listed on both BSE and NSE. Until listing, the stocks will not be available for trading.
As per Nuvama Wealth Management, the implied share value of the CV division is about Rs. 274 per share, making the total value of the company around Rs. 1 lakh crore.
After the de-merger, the value of the PV + JLR unit is at Rs. 400 per share, implying a joint pre-demerger valuation of about Rs. 674 per share, in line with analysts' forecasts.
Brokerage firm Nomura, after the de-merger, gave target prices of Rs. 367 for the PV unit and Rs. 365 for the CV unit, indicating even distribution of value.
Motilal Oswal Financial Services pointed out that the PV segment, including Jaguar Land Rover (JLR) and Tata's electric vehicles, stands to gain from growing domestic demand and improving profitability.
The CV segment, which relies on a strong market position in medium and heavy commercial vehicles, is anticipated to gain from India's growing infrastructure and logistics demand.
As per market analyst Avinash Gorakshakar, the separation promotes the efficient use of capital, allowing both firms “to concentrate on growth and partnerships with clear focus.”
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According to experts, the demerger will act as a catalyst for value-unlocking, providing Tata Motors with the option to grow each division separately.
The PV + JLR unit will be the biggest growth contributor, and the CV segment will mainly rely on demand trends of strong domestic and export markets.