Tata Motors Shares Adjust to CV Demerger — Why You Should Ignore the 40% Plunge
Tata Motors’ stock moved sharply on October 14, 2025 after the company’s demerger of its commercial vehicle (CV) business took effect. The post-demerger discovery price for the passenger-vehicle entity showed a sharp drop relative to the pre-demerger quote — a technical adjustment rather than a loss of underlying value.
What happened on October 14, 2025?
During the special pre-open session on October 14, the passenger-vehicle entity was discovered at ₹400 per share — a number that looks like a steep fall when compared with the legacy consolidated quote. On BSE the stock opened at ₹399 and traded near ₹391.35 at one point the same day. These moves are part of the mechanical adjustment after the CV business was carved out.
Demerger at a glance
| Event | Date / Detail |
|---|---|
| Demerger effective date | October 1, 2025 |
| Record date | October 14, 2025 — shareholders on this date receive TMLCV shares (1:1) |
| TMLCV expected listing | November 2025 (expected) on BSE & NSE |
| Passenger vehicle arm | Renamed Tata Motors Passenger Vehicles (TMPV / TMPVL) |
Why the 40%-looking drop is not fundamental
The apparent ~40% fall is a technical outcome of the stock trading ex the CV business. Previously, one Tata Motors quote included both passenger and commercial vehicle segments. Post-demerger, the passenger vehicle listing reflects only that business and shareholders get an additional listing (TMLCV) for the commercial vehicle business on a 1:1 basis.
Short-term outlook vs long-term view
Expect volatility in the near term as markets price both TMPV and TMLCV independently. Over time, the combined market capitalisation of the two listed businesses should better reflect the underlying economics.
Shareholder action items
- Verify holdings on the record date (Oct 14) — entitlement to TMLCV is 1:1.
- Avoid knee-jerk selling immediately after the discovery/open price — this is often mechanical.
- Re-evaluate allocation after both TMPV and TMLCV begin regular trading and market caps are visible.
Price performance context
Prior to the demerger action, Tata Motors had been down roughly 7% over the previous month and over 11% in 2025 so far, after a strong multi-year rally (~420% over five years). These moves pre-date the mechanical adjustment and reflect market reactions to broader sector and stock-specific news.
Sources & further reading
Market reports from major business outlets, exchange feeds and broker notes outlining the demerger mechanics and expected listing schedule (Oct–Nov 2025).
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