Tata Motors CV Shares Decline 5% Post-Listing: Analysts Remain Optimistic
Tata Motors' newly demerged commercial vehicle (CV) division experienced a 5% decline in share price over its first two trading sessions, closing at Rs 316.50 from its listing price of Rs 335.00. Despite this initial dip, analysts maintain a positive outlook on the company's long-term prospects. The demerged entity reported revenue of Rs 75,055.00 crore and an EBITDA of Rs 8,856.00 crore with an 11.8% margin. Analysts cite improving freight activity, easing commodity costs, and GST rate cuts as potential growth drivers for the CV segment. The company has scheduled a board meeting to consider Q2FY26 financial results.
*this image is generated using AI for illustrative purposes only.
Tata Motors' commercial vehicle (CV) division, recently demerged and listed as a separate entity, has experienced a 5% decline in share price over its first two trading sessions. Despite this initial dip, analysts maintain a positive outlook on the company's long-term prospects.
Market Performance
The newly listed Tata Motors (Commercial Vehicles) shares made their debut on the National Stock Exchange (NSE) at Rs 335.00, representing a 28.5% premium to its implied value of Rs 260.75. However, the stock price retreated to Rs 316.50 by Thursday, marking a 5% decrease from its listing price.
| Metric | Value |
|---|---|
| Listing Price | Rs 335.00 |
| Implied Value | Rs 260.75 |
| Current Price | Rs 316.50 |
| Decline | 5% |
Financial Highlights
The demerged commercial vehicle entity has reported the following financial figures:
| Metric | Value |
|---|---|
| Revenue | Rs 75,055.00 crore |
| EBITDA | Rs 8,856.00 crore |
| EBITDA Margin | 11.8% |
Analyst Perspectives
Despite the initial price decline, market analysts remain optimistic about the company's future:
- SAMCO Securities estimates a fair value around Rs 310.00-320.00 per share.
- SBI Securities has valued the company between Rs 320.00-470.00 per share.
Strategic Implications of Demerger
The demerger separates Tata Motors' commercial vehicle business from its passenger vehicle segment. This strategic move is expected to allow for more focused investment and management in each division, potentially leading to improved performance and shareholder value.
Positive Factors for CV Segment
Analysts have identified several factors that could positively impact the commercial vehicle demand:
- Improving freight activity
- Easing of commodity costs
- GST rate cuts
Upcoming Financial Results
Tata Motors Limited (formerly TML Commercial Vehicles Limited) has scheduled a board meeting to consider and approve the financial results for Q2FY26. The company will host an investor/analyst conference call on the same day to discuss these results.
Trading Window Closure
In compliance with insider trading regulations, Tata Motors has closed the trading window for its designated persons until 48 hours after the announcement of the Q2FY26 financial results.
While the initial market response has been mixed, the demerger and separate listing of Tata Motors' commercial vehicle business represent a significant strategic shift. Investors and analysts will be closely watching the upcoming financial results and management commentary for further insights into the company's performance and future prospects.
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