On March 4, Tata Motors Ltd (TML) announced its decision to separate its businesses into two distinct listed entities: commercial vehicles (CV) and passenger vehicles (PV). The company stated, “The demerger follows the prior subsidiarisation of PV and EV businesses in 2022, enhancing each business’s ability to pursue its strategies for increased growth and agility while maintaining accountability.”
In recent years, Tata Motors’ CV, Passenger Vehicles (PV+EV), and Jaguar Land Rover (JLR) divisions have implemented separate growth strategies. Since 2021, these divisions have operated independently under their respective CEOs, as noted by Tata Motors.
Tata Motors’ stock on BSE closed unchanged at Rs 989 on Monday. The demerger will be executed through an NCLT scheme of arrangement, ensuring that all TML shareholders maintain identical shareholdings in both listed entities. The company stated in a stock exchange filing that obtaining necessary approvals from shareholders, creditors, and regulatory bodies could take an additional 12-15 months to complete the demerger process.