Tata Motors Completes Landmark Demerger of Passenger and Commercial Vehicle Businesses

Tata Motors Limited, a key entity within the Tata Group, has finalized the significant demerger of its passenger vehicle (PV) and commercial vehicle (CV) divisions. This corporate restructuring became effective on October 1, 2025, following approvals from the National Company Law Tribunal (NCLT), creating two distinct publicly traded entities.

The passenger vehicle business, encompassing domestic cars, the electric vehicle (EV) segment, and the luxury brand Jaguar Land Rover (JLR), will continue within the existing company, renamed Tata Motors Passenger Vehicles Limited (TMPVL) as of October 13, 2025.

Concurrently, the commercial vehicle operations, including trucks and buses, have been transferred to a new entity, TML Commercial Vehicles Limited, which has adopted the name Tata Motors Limited as of October 29, 2025. The record date for shareholders to receive entitlements in the new commercial vehicle entity is October 14, 2025. Shareholders will receive one equity share of the new Tata Motors Limited for each share held in the parent company. The shares of the new commercial vehicle entity are expected to be listed on the BSE and NSE within 45-60 days after submission of applications.

Impact This demerger is anticipated to unlock value by enabling each business segment (PV/EV/JLR and CV) to pursue tailored strategies and capital allocation. Investors may benefit from clearer investment theses for each entity, potentially leading to improved valuations and operational efficiencies, fostering specialized growth for both passenger and commercial vehicle sectors within the Tata Motors group. Rating: 8/10

Difficult Terms Demerger: A corporate action where a company splits into two or more independent companies, dividing its assets and liabilities between the new entities. Passenger Vehicle (PV): Vehicles designed for transporting a small number of people, such as cars and SUVs. Commercial Vehicle (CV): Vehicles designed for business purposes, such as trucks and buses. National Company Law Tribunal (NCLT): A quasi-judicial body in India that adjudicates company-related matters. Composite Scheme of Arrangement: A legal process approved by regulatory bodies for corporate restructuring like mergers or demergers. Appointed Date: The specific date from which the financial effects of a demerger are recognized. Record Date: A specific date used to identify shareholders eligible to receive benefits, such as new shares, from a corporate event. Equity Share: The most common type of stock, representing ownership in a company. BSE (Bombay Stock Exchange): One of India's major stock exchanges. NSE (National Stock Exchange): India's leading stock exchange.