Tata Motors, a leading Indian automotive manufacturer, has completed a significant corporate restructuring, splitting its passenger and commercial vehicle businesses into two separate entities. This move, finalized on October 1, has resulted in the creation of Tata Motors Passenger Vehicles Ltd. (TMPV) and Tata Motors Commercial Vehicles Ltd. (TMLCV).

Key Details of the Demerger

• Record Date: October 14, 2023
• Share Allocation: 1:1 ratio (One TMLCV share for each Tata Motors share held)
• Total Shares Allotted: 3,68,23,31,373 fully paid equity shares
• Face Value: Rs 2 per share
• Allotment Date: October 15, 2023

Current Status and Next Steps

The demerger process has reached a crucial stage, with shareholders who held Tata Motors shares on or before the record date now seeing TMLCV shares in their demat accounts. However, these newly allocated shares are not yet available for trading due to pending regulatory approvals from the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE).

Timeline for Trading Commencement

Corporate Structure Changes

• TMLCV ceased to be a wholly-owned subsidiary of Tata Motors as of October 15, 2023.
• Tata Motors Limited plans to change its name to Tata Motors Passenger Vehicles Ltd.
• The renamed entity will continue to operate the passenger vehicles business, including electric vehicle investments and Jaguar Land Rover (JLR).

This corporate action represents a significant shift in Tata Motors' structure, potentially allowing for more focused management and strategy implementation in both the passenger and commercial vehicle segments. Shareholders and potential investors should keep an eye on further announcements regarding the listing and trading of TMLCV shares, which is expected to occur in the coming weeks.

Tata Motors , a leading Indian automotive manufacturer, has completed a significant corporate restructuring, marking a new chapter in its business operations. The company's passenger vehicle business will now trade under a new name, reflecting the separation of its commercial and passenger vehicle segments.

Key Highlights of the Demerger

• New Trading Name: Tata Motors Passenger Vehicles (TMPV)
• Effective Date: October 24, 2023
• Demerger Record Date: October 14, 2023
• Share Entitlement Ratio: 1:1

Business Separation Details

The demerger, which became effective on October 1, 2023, splits Tata Motors into two independent listed entities:

Shareholder Impact

Shareholders of Tata Motors will receive one share in the commercial vehicle company for every Tata Motors share held as of the record date. This 1:1 share entitlement ensures that existing shareholders maintain their stake in both resulting entities.

Stock Price Adjustment

Following the record date, Tata Motors' stock price experienced a significant adjustment:

• Price Drop: Nearly 40%
• Reason: Technical adjustment post-demerger
• Implication: The entities are now valued independently

Future Outlook

The commercial vehicle arm is expected to be listed separately, pending final regulatory clearances. This strategic move aims to allow each business to focus on its core competencies and pursue independent growth strategies.

The demerger and renaming process mark a pivotal moment for Tata Motors, potentially setting the stage for more focused operations and tailored strategies in both the commercial and passenger vehicle segments. Investors and market watchers will be keen to observe how this restructuring impacts the performance and valuation of both entities in the coming months.