Tata Motors Demerger Effective from October 1, 2025 — Here’s What Shareholders Need to Know
Tata Motors Demerger Effective from October 1, 2025 — Here’s What Shareholders Need to Know
Tata Motors is all set to restructure its business operations by splitting into two separately listed companies, and the company has now officially confirmed the effective date of this long-anticipated demerger. As per the latest exchange filing and investor presentation, the demerger will take effect from October 1, 2025, marking a major milestone in the company’s transformation strategy.
The final hearing on the demerger scheme has already been concluded by the National Company Law Tribunal (NCLT), and the order is currently reserved. Tata Motors has stated that it aims to complete the entire demerger process within the second quarter of the financial year 2025–26, meaning the execution will be wrapped up by the end of this quarter.
Under the approved plan, Tata Motors will divide its core businesses into two distinct entities. The Commercial Vehicle (CV) business, along with its associated investments, will be transferred to a newly formed entity called TML Commercial Vehicles Limited (TMLCV). Once the demerger becomes effective, this new entity will be renamed to Tata Motors Ltd., inheriting the original name.
Meanwhile, the Passenger Vehicle (PV) segment, which includes the rapidly growing Electric Vehicle (EV) division and the Jaguar Land Rover (JLR) business, will remain part of the existing listed entity. This business will continue under the name Tata Motors Ltd., retaining the branding and structure that investors are already familiar with.
For shareholders, the company has also provided clarity on the demerger ratio. Tata Motors confirmed that the split will follow a 1:1 ratio, meaning investors will receive one share of the new entity for every one share held in the current Tata Motors stock. Both companies will be listed separately on the BSE and NSE post demerger.
As for the record date, which determines which shareholders are eligible to receive shares in the new company, Tata Motors has said it will be announced in due course through a stock exchange filing and a public notice. Once the record date is set, the stock will go ex-trade, adjusting its price accordingly to reflect the split.
From a business performance standpoint, Tata Motors also reported that its commercial vehicle segment faced a modest slowdown, with revenue dipping nearly 5% year-on-year, amounting to approximately ₹17,000 crore in the first quarter of this financial year.
This demerger is expected to bring sharper focus to each segment, enabling independent strategy execution, faster decision-making, and better capital allocation. By separating the commercial and passenger vehicle operations, Tata Motors aims to create two growth-driven companies that can cater to their specific markets more effectively.
