Tata Motors is in the spotlight this week. The reason behind this is that the auto giant is moving into a new chapter with its much-awaited demerger taking effect from October 1. With this upcoming demerger, the company will officially separate its passenger vehicle (PV) and commercial vehicle (CV) businesses. This will break it into two independently listed entities.
As the effective date is just around the corner, let’s take a look at the 5 most important things to know about this upcoming demerger such as record date, share allotment, listing and much more
Tata Motors demerger: NCLT gives its approval
The company through a regulatory filing on September 26 said that the National Company Law Tribunal (NCLT), Mumbai Bench has cleared the way for the demerger.
In the regulatory filing, the company said, “Hon’ble National Company Law Tribunal (NCLT), Mumbai Bench had sanctioned the Composite Scheme of Arrangement amongst Tata Motors Limited (the Company or Demerged Company), TML Commercial Vehicles Limited (TMLCV or Resulting Company), Tata Motors Passenger Vehicles Limited and their respective shareholders under Sections 230-232 of the Companies Act, 2013 and other relevant provisions (Scheme).”
The company also said it has now received true copies of the NCLT Orders dated August 25, 2025, and September 10, 2025, which were placed before the respective boards on September 26, 2025.
Tata Motors demerger: Two separate listed companies
The demerger will result in Tata Motors splitting into two different listed entities. This includes –
TML Commercial Vehicles (TMLCV) – housing the commercial vehicle segment.
Tata Motors Passenger Vehicles – covering the passenger vehicle operations.
This separation will allow each business to run as an independent company on the stock exchanges.
Tata Motors demerger: Effective date confirmed
Tata Motors has clarified when the demerger will officially take effect. In its filing, the company said, “The Boards of the respective companies, at their meeting held today resolved to make the Scheme effective on October 1, 2025.”
Tata Motors demerger: Record date still awaited
While the effective date has been confirmed, the record date, that is, the cut-off date to determine eligible shareholders who will receive shares in the new entity has not yet been disclosed.
The company noted, “The Company will separately notify the Effective Date of the Scheme and the “Record Date”, for determining the Shareholders of the Company who shall be entitled to receive 1 (one) fully paid equity share in TMLCV (face value of Rs 2/- each) for every 1 (one) fully paid equity share of the Company.”
Tata Motors demerger: Share swap ratio – 1:1
One of the most crucial details for shareholders is the demerger ratio. Tata Motors has kept it simple and that is for every one share held in Tata Motors, investors will receive one share in TML Commercial Vehicles Limited.
The filing reads, “entitled to receive 1 fully paid equity share in TMLCV (face value of Rs 2 each) for every 1 fully paid equity share of the Company.”
Once the record date and allotment are completed, Tata Motors is expected to announce a separate listing date for the newly formed entities.