October 14, 2025:
The long-awaited Tata Motors demerger has officially taken effect today. The move separates the company’s Commercial Vehicle (CV) business from its Passenger Vehicle and Jaguar Land Rover (JLR) operations — creating two independent listed entities.
As part of the demerger, shareholders will now hold two shares for every one share of Tata Motors they previously owned.
Here’s what that means:
If an investor held 1 share of Tata Motors, they will now have —
- 1 share of Tata Motors (Passenger Vehicles + JLR business), and
- 1 additional share of the new company — Tata Motors Commercial Vehicle Limited (TMLCV).
The share allotment will be done in a 1:1 ratio, meaning every existing shareholder receives an equal number of shares in the new entity.
💹 Why the Demerger?
Tata Motors said the separation will help both businesses focus better on their respective markets. The passenger and EV divisions can now drive premium and technology-led growth, while the commercial vehicle arm can pursue efficiency and fleet modernization independently.
Analysts believe this step could unlock long-term shareholder value, as each business will be valued separately by the market based on its growth potential and earnings.
📉 Stock Market Reaction
On the day of the demerger (October 14), Tata Motors shares saw sharp volatility. The stock reportedly traded around ₹400, down nearly 40%, as markets adjusted for the value that will move to the new commercial vehicle company.
Such price adjustments are normal during a corporate split — since part of the original company’s value now belongs to the newly formed unit.
💰 What Could Be the Price of TM-LCV?
While the company hasn’t made any official announcement about the listing value, market experts and news reports suggest that TML Commercial Vehicle Ltd (TM-LCV) could list around ₹250–₹300 per share once it is officially traded.
This is only an early market estimate based on analysts’ allocation of roughly 35–40% of Tata Motors’ total business value to its commercial vehicle segment.
📌 Important Note:
These figures are not officially confirmed by Tata Motors. The final listing price will depend on market sentiment, valuations, and official filings once the new company is listed.
🧭 What Happens Next?
- Shareholders will soon see new TMLCV shares credited to their Demat accounts.
- Both entities — Tata Motors Ltd (Passenger + JLR) and TML Commercial Vehicle Ltd — will trade independently once the demerged company is listed (expected in the coming weeks).
- Analysts expect initial volatility, as the market sets fair valuations for both businesses.
🏁 Bottom Line
After the demerger, Tata Motors investors effectively hold two separate companies — one focused on passenger vehicles and JLR, and another on commercial vehicles.
This structural change aims to give clearer visibility into each business’s performance and growth potential.
However, experts advise investors to remain patient, as share prices of both companies may take some time to stabilize post listing.
Also Read
Leave a Reply