Tata Motors demerger complete: What does it mean for shareholders?
What's the story
Tata Motors has completed its demerger process, with a record date of October 14, 2025. Under the approved scheme of arrangement, shareholders who held Tata Motors shares on the record date received one share of Tata Motors Commercial Vehicles Limited (TMLCV) for every one share held in Tata Motors. The move separates the company's Commercial Vehicle (CV) business from its Passenger Vehicle (PV) division.
Market impact
Share price movements and regulatory filing details
The share price of Tata Motors started trading ex-demerger on October 14. The stock now represents only the passenger vehicle (PV) business, after the carve-out of the CV segment. In a regulatory filing, Tata Motors confirmed that 368.23 crore fully paid equity shares of face value ₹2 each have been allotted to eligible shareholders of TMLCV under the 1:1 ratio.
Future plans
Next steps for investors post-demerger
The next major milestone for investors will be the listing of TMLCV shares on the BSE and NSE. This is likely to happen within 45-60 days from the filing of required applications with these stock exchanges. Post-demerger, Tata Motors's PV business, including its EV vertical and Jaguar Land Rover (JLR), has been valued at around ₹1.45 lakh crore. The CV arm is tipped to hold similar valuations.
Shareholder insights
Analyst insights on demerger impact
On October 14, stocks of Tata Motors were discovered at ₹400 apiece on NSE, compared with the pre-demerger close of ₹660.75. This implies a valuation of around ₹260.75 per share for TMLCV. Prashanth Tapse from Mehta Equities, said that Tata Motors demerger not only enhances strategic clarity but also unlocks shareholder value as in a combined entity, one segment is often undervalued by the market due to the overshadowing performance of the other.
Market predictions
Valuations of standalone businesses post-demerger
Tapse values the standalone Tata Motors Commercial Vehicles at around ₹400 per share, based on financial metrics, growth prospects, and peer valuation multiples. He estimates the Tata Motors PV business to be valued at around ₹500 per share. Nomura has valued Tata Motors Passenger Vehicles (TMPV) at ₹367 per share and TMLCV at ₹365 per share while cautioning about short-term "technical volatility" as the stock stabilizes at ex-demerger levels.