Tata Motors’ share price closed at ₹718.90 after its PV-CV demerger became effective from October 1, 2025.
Shareholders will receive a 1:1 share entitlement in TML Commercial Vehicles, with record date fixed for October 14, 2025.
Analysts remain cautiously optimistic, citing separate growth paths for PV and CV divisions with strong leadership appointments.
Tata Motors demerger, a historic restructuring in India’s automobile industry is taking effect from October 1, 2025. The company has formally split its passenger vehicle (PV) and commercial vehicle (CV) divisions into two separate entities. The split is done to unlock greater value and operational focus.
Following the announcement, Tata Motors share price traded at ₹718.90, up 0.08% from its previous close of ₹718.35 at press time. Let’s explore the demerger details along with how it impacts Tata Motors share price today based on Moneycontrol data.
Tata Motors stock opened at ₹718.50 and touched an intraday high of ₹739.70 before slipping to a low of ₹715. Its market capitalisation is at ₹2.64 lakh crore. With volumes of over 21.8 million shares traded against a 20-day average of 11.4 million, investor participation was strong. The stock is trading 24% below its 52-week high of ₹949.20 but still comfortably above its 52-week low of ₹535.75.
Tata Motors share price chart on Moneycontrol shows a slight dip of 0.04% at 1.27 PM:
Tata Motors shares trade at a trailing P/E ratio of 12.50, lower than the broader sector’s P/E of 39.42. It means that there may be re-rating once the demerger plays out. The dividend yield stands at 0.83%, offering moderate income alongside potential capital appreciation.
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Under the approved scheme of arrangement, the commercial vehicle business will be a part of a new entity, TML Commercial Vehicles (TMLCV). Meanwhile, the passenger vehicle division will be under Tata Motors, renamed as Tata Motors Passenger Vehicles.
The entitlement ratio has been set at 1:1. This means every shareholder holding one fully paid-up equity share of Tata Motors will receive one share of TMLCV with a face value of ₹2. The record date to determine eligible shareholders has been fixed as October 14, 2025.
Industry experts see this restructuring as a strategic move to offer sharper focus, separate capital allocation priorities, and greater visibility for both business segments. The CV arm is expected to attract investor attention once it gets listed on the exchanges in November.
Tata Motors also announced top-level management changes. Girish Wagh has been appointed as Managing Director and CEO of TML Commercial Vehicles. At the same time, Shailesh Chandra will lead Tata Motors Passenger Vehicles for a three-year term ending in September 2028.
Chandra will also continue to oversee Tata Passenger Electric Mobility, ensuring continuity in the company’s ambitious EV roadmap. Analysts believe this leadership alignment will provide strong execution capability for both new entities.
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The separation of CV and PV divisions is expected to create better operational efficiency and market-driven strategies. The CV segment, which will carry forward non-convertible debentures worth ₹2,300 crore, is projected to benefit from infrastructure growth and rising demand for fleet modernization. The PV business, meanwhile, is likely to focus on premiumisation, electrification, and leveraging JLR synergies.
Despite short-term volatility, most analysts remain cautiously optimistic. Out of 28 analysts on Moneycontrol, 25% recommend a ‘Buy’ and 18% see an ‘Outperform,’ while 32% suggest ‘Hold.’ Only 14% advise ‘Sell,’ reflecting balanced but positive sentiment.
Tata Motors is entering a new phase in its corporate journey with the demerger complete and separate listings on the horizon. For investors, the split offers an opportunity to tap into two distinct growth stories. On one hand, there is the steady potential of passenger vehicles. On the other hand, they can invest in the cyclical but high-margin opportunity in commercial vehicles.
1. What is Tata Motors’ share price after the demerger?
Tata Motors’ share price closed at ₹718.90 on October 1, 2025, following the implementation of its demerger. The price reflects cautious optimism from investors as the PV and CV businesses begin operating independently.
2. What will happen to Tata Motors' shareholders with the demerger?
Under the demerger proposal, Tata Motors shareholders will receive one share of TML Commercial Vehicles Ltd for each share held in Tata Motors. The 1:1 entitlement allows investors to participate in both growth stories.
3. What is the record date for Tata Motors demerger shares?
The company has announced October 14, 2025, as the record date to ascertain eligible shareholders for the demerged entity. Shareholders held Tata Motors stock prior to this date will receive TMLCV shares.
4. How will the Tata Motors demerger affect Tata Motors' business operations?
The separation of Tata Motors PV and CV businesses allows each to focus on their respective priority - premiumisation and EVs in PV, fleet modernization, and infrastructure growth in CV. This may unlock stronger long-term value.
5. Should investors purchase Tata Motors stock in the wake of the demerger?
Analyst viewpoints reveal an ambivalent but cautiously positive bias. Approximately 43% have a Buy or Outperform recommendation based on undervaluation (12.5 P/E). Investors would be wise to watch for near-term volatility prior to fresh positions.