The Indus Zone Tech Desk | Mumbai | October 15, 2025 – The much-anticipated Tata Motors demerger has officially been completed, setting the stage for a major realignment in India’s automobile industry. With the separation of Tata Motors into two independent listed entities — one focusing on passenger vehicles (PV) and the other on commercial vehicles (CV) — investors and analysts are now turning their attention to how each segment will perform independently in the coming months.
Tata Motors Demerger: The Final Step of an 18-Month Process
After nearly a year and a half of restructuring, Tata Motors Ltd. began trading ex-demerger this week, marking the final step in its corporate separation. Under the new structure, Tata Motors Passenger Vehicles Ltd. will oversee the company’s domestic car lineup, electric vehicles, and Jaguar Land Rover (JLR), while TML Commercial Vehicles Ltd. — now renamed Tata Motors Ltd. — will focus entirely on the commercial vehicle segment.
According to the company’s 9 October exchange filing, the newly formed CV division is expected to list on Indian stock exchanges within the next 60 days. Tata Motors shareholders will receive one share of Tata Motors CV for every share held prior to the demerger, ensuring identical ownership structures across both companies at the outset.
Tata Motors CV Share Price: Analysts Predict Strong Upside
At the time of the demerger, Tata Motors’ stock adjusted to reflect the value of its two distinct businesses. On Tuesday, the passenger vehicle shares opened at ₹400, compared to ₹660.75 the previous day — effectively pegging the Tata Motors CV share price at ₹260.75.
However, several financial institutions believe this value significantly undervalues the CV business. Analysts at Nomura Financial Advisory and Securities (India) Pvt. Ltd. have set a combined target price of around ₹732 for both divisions, split nearly evenly between the two — ₹365 for Tata Motors CV and ₹367 for Tata Motors PV.
Nomura’s report highlights Tata Motors CV’s strong fundamentals, with industry-leading margins, improving demand, and positive cash flow from its robust truck and bus business. The brokerage expects the commercial vehicle arm to benefit from upcoming economic and infrastructure reforms, as well as potential export expansion following its recent Iveco partnership.
Brokerages See Value-Unlocking Potential
Other market experts share a similarly bullish outlook. According to Ambit Institutional Equities, the commercial vehicle business could experience “immediate value unlocking” as it prepares for its standalone listing. The brokerage expects the Tata Motors CV share price to stabilize around ₹380 per share, citing its dominant position in India’s heavy and light truck segments.
Meanwhile, SBI Securities projects an even broader trading range — between ₹320 and ₹470 per share — once the new company debuts on the bourses. The firm emphasized that Tata Motors CV has strong prospects for margin expansion, supported by cost optimization, product innovation, and a reduction in the Goods and Services Tax (GST) on commercial vehicles from 28% to 18%.
This tax reduction is expected to drive recovery in the commercial vehicle sector in FY26, particularly in infrastructure, logistics, and construction categories. Combined with growing replacement demand for trucks and buses, analysts say these factors could drive healthy revenue growth for Tata Motors CV in the medium term.
What’s Next for Tata Motors Passenger Vehicles (PV)?
While the CV business appears poised for growth, the outlook for the Tata Motors PV segment remains mixed. The passenger vehicle arm, which will continue to include Jaguar Land Rover and Tata EVs, faces multiple global and domestic challenges.
The EV market in India is becoming intensely competitive, with strong players like Mahindra, MG Motor, and Hyundai rolling out aggressive new models. Meanwhile, JLR’s overseas operations have been affected by global trade disruptions and a recent cyberattack that temporarily halted production.
Despite these challenges, Tata Motors remains the second-largest carmaker in India, and the company’s expanding EV portfolio — led by models like Nexon EV and Punch EV — positions it well for long-term growth. Additionally, the recent GST cut on small cars offers some relief, potentially improving sales momentum in FY26.
The Bigger Picture: Why the Demerger Matters
The Tata Motors demerger is part of a larger strategy to unlock shareholder value by allowing each business to pursue its own growth strategy and attract specialized investors.
Tata Motors CV Ltd. will focus on heavy commercial vehicles, light commercial vehicles, and buses — strengthening its leadership in the mobility and infrastructure ecosystem.
Tata Motors Passenger Vehicles Ltd. will focus on the booming electric and luxury vehicle markets, leveraging JLR’s global brand appeal and Tata’s innovation in EV technology.
This structural clarity is expected to improve operational efficiency and allow each business to optimize its capital allocation and profitability independently.
Investor Outlook and Market Sentiment
Market sentiment around Tata Motors remains largely positive. Analysts believe the demerger will not only enhance corporate governance but also increase investor transparency in how each segment performs financially.
Nomura and Ambit both maintain a “Buy” rating on Tata Motors’ post-demerger stock, while long-term investors are advised to monitor the upcoming CV listing closely for potential entry opportunities.
The separate listing of Tata Motors CV within the next two months will be a key milestone, offering investors the chance to directly invest in India’s largest commercial vehicle manufacturer at what many analysts believe is an attractive valuation.
