Tata Motors Demerger News & Share Price Update

Tata Motors is in the news today in the stock market as the company’s demerger has become effective from today i.e. October 14, 2025. This has led to a sharp drop in the Tata Motors share price which is actually a technical adjustment, not a weakness of the company. The stock now reflects only the Passenger Vehicle (including JLR) business, while the Commercial Vehicle (TMLCV) unit will be separated and listed soon. This move is considered a major shift towards value unlocking and clear focus for the company.

Tata Motors Share Price Today: Market Reaction and Key Numbers

Pre-open and early trading performance : 

In the pre-open session this morning, Tata Motors’ new share price was set at around ₹399–₹400. This new level is because the stock is now trading as an ex-commercial vehicle (CV) business meaning the stock now represents only the Passenger Vehicle + JLR business. The previous close was ₹660.90. If you compare that to today’s opening level, the decline appears to be close to 40% but this isn’t a “crash,” but rather a technical adjustment.

Tata Motors Demerger Details

Tata Motors has decided to separate its Commercial Vehicle (CV) business into an independent entity separate from the Passenger Vehicle + JLR + EV business. This means the company will now be split into two parts, and both will be listed separately.

• CV Business: New company to be formed TML Commercial Vehicles Limited (TMLCV)
• PV / JLR / EV Business: The original Tata Motors entity will now become Tata Motors Passenger Vehicles Ltd (TMPV / TMPVL).

The purpose of this split is to provide a focused strategy, better management, and separate businesses, allowing investors to see the true value of each part.

Tata Motors Share Ratio & Key Dates

Impact on Shareholders

• After the demerger, if you own 100 Tata Motors shares, you will receive 100 TMLCV shares. You will now own shares in two companies: TMPV (Passenger/JLR) and TMLCV (Commercial Vehicles).
• Price Adjustment: The price of the old Tata Motors share has decreased due to the removal of the CV portion, but investors will receive the full value through their stake in the new entity, TMLCV.
• Renaming/Listing: TMLCV will be listed on the BSE and NSE (likely by November 2025) and the TMPV company will change its name.
• Debt and NCD Transfer: The company’s Non-Convertible Debentures (NCDs) will also be transferred to TMLCV.
• Investors need to understand that this is a structural change. The performance, long-term prospects, and management direction will be different, not just a share price decline.

TMLCV & TMPV: What Happens Next

Business Focus Areas: Following the demerger, TMLCV (Tata Motors Commercial Vehicles Limited) will now focus solely on commercial vehicles such as trucks, buses, and logistics. The company recently completed the acquisition of Iveco Group, which will benefit from global technology and market expansion. TMPV (Tata Motors Passenger Vehicles Limited) will include cars, SUVs, electric vehicles, and the Jaguar Land Rover business. TMPV will now focus on increasing its market share in the electric vehicle and premium segments.
Market Expectations : The market expects the demerger to unlock value in both new divisions of Tata Motors. Analysts believe that as separate companies, Tata Motors will be able to operate with greater focus on their respective sectors. This change will help improve capital utilization and bring transparency to operations. The temporary decline following the demerger is due to technical adjustments, not a decline in the company’s performance.
Potential Value and Listing : According to brokerage reports, the estimated value of TMPV is between ₹285 and ₹384, while that of TMLCV is estimated to be between ₹320 and ₹470. Investors will receive new TMLCV shares in their demat accounts by November 2025. After this, both companies will be independently listed on the NSE and BSE.
Risks and Opportunities : While this split is considered positive in the long term, volatility may persist in the short term. TMPV’s success will largely depend on JLR’s performance and the growth of the electric vehicle segment. TMLCV will have to deal with new acquisitions and competition in the commercial vehicle market. This is a new beginning for both companies, which will determine their true value in the coming months.

The Reason behind the fall in Tata Motors shares

The Impact of Technical Adjustments : The biggest reason for the decline in Tata Motors’ stock is the impact of its demerger. The stock now represents only the Passenger Vehicle and JLR businesses, while the Commercial Vehicle unit (TMLCV) has been separated. Consequently, the share price has been reset to reflect the new structure. This decline may seem significant, but it is merely a valuation adjustment, not a sign of the company’s weakness.
Investors’ Short-Term Reaction : Market uncertainty increased immediately after the demerger. Many investors were unsure about the value of each unit under the new structure, so they began booking short-term profits. This created selling pressure on the stock, leading to a slight decline in prices. However, in the long run, this process will help highlight the companies’ differentiated strengths.
JLR and the Pressure of Global Challenges : Tata Motors’ subsidiary, Jaguar Land Rover (JLR), has recently faced several difficulties. A cyber attack impacted its production and supply chain, leading to a decline in sales. The company has also lowered its EBIT margin guidance for FY26 to 5–7%, lower than earlier estimates. Furthermore, rising costs, slowing demand, and the challenges of the electric vehicle transition are impacting the global auto sector.
A Summary of the Current Situation : The decline seen today is primarily a result of structural changes, investor sentiment, and international risks. Experts believe that investors will see the true growth potential of both TMLCV and TMPV once they begin operating independently.

Future Outlook: What Should Investors Do Now

Currently, the Tata Motors share price is hovering around ₹380–₹418. This level fully reflects the adjustment that has occurred since the demerger. Currently, the market’s focus is on the upcoming listing of TMLCV, which is expected by November 2025. This listing will help better assess the true value of both companies.

On the other hand, TMLCV is now focused on electric vehicles and JLR’s premium segment. Tata Motors’ EV sales have seen annual growth of approximately 18% in recent months, reflecting the company’s long-term focus. JLR, meanwhile, reported a 3.5% volume decline last quarter, but management has stated that the supply chain is expected to normalize by FY26.

Amidst all these factors, the market is examining whether the demerger will truly enhance the company’s organizational efficiency and brand value. The situation is currently in balance.

Also Read : Best Data Center Stocks in India 2025

Conclusion

With the demerger of Tata Motors, the company has given its business a new direction. The decline in the stock is a natural reaction to this restructuring, not a sign of any deterioration in the company’s position. Tata Motors will now operate as two separate entities TMLCV and TMPV allowing each division to better focus on its respective areas. It will be interesting to see how this change impacts the company’s growth and value in the future.