Tata Motors Demerger: Commercial and Passenger Vehicle Businesses to Form Separate Listed Entities

Tata Motors Ltd (TML) announced on March 4 its decision to demerge its businesses into two distinct listed entities: one for commercial vehicles (CV) and the other for passenger vehicles (PV), including electric vehicles (EVs), Jaguar Land Rover (JLR), and related investments.

“The demerger is a natural progression following the earlier subsidiarization of PV and EV businesses in 2022. It will empower each business to pursue its strategies independently, fostering higher growth with increased agility while enhancing accountability,” stated the automaker.

In recent years, Tata Motors’ CV, PV+EV, and JLR divisions have implemented separate growth strategies. Since 2021, these businesses have operated autonomously under their respective CEOs.

On Monday, Tata Motors’ stock on the BSE closed flat at Rs 989.

The demerger will be executed through an NCLT scheme of arrangement, ensuring that all TML shareholders maintain identical shareholding in both listed entities. Tata Motors noted in a stock exchange filing that obtaining necessary shareholder, creditor, and regulatory approvals may take an additional 12-15 months to finalize the demerger.