Tata Motors Passenger Vehicles and Tata Motors Commercial Vehicles Shares in Focus as it Announces Cost Apportionment Post-Demerger

Tata Motors Passenger Vehicles Limited (formerly Tata Motors Limited) and Tata Motors Limited (formerly TML Commercial Vehicles Limited) were in the spotlight on Wednesday after the company released details the cost of acquisition of shares between the two entities post-demerger.

Company Clarifies Cost Apportionment

In a filing to the BSE and NSE dated 12 November 2025, Tata Motors Passenger Vehicles Limited announced the apportionment of the cost of acquisition between the two listed entities.

This follows the demerger sanctioned by the National Company Law Tribunal (NCLT), Mumbai Bench, through its orders dated 25 August and 10 September 2025.

As per the exchange filings, the details are as follows:

• Tata Motors Limited (formerly TML Commercial Vehicles Limited): 31.15%
• Tata Motors Passenger Vehicles Limited (formerly Tata Motors Limited): 68.85%

Apportionment of Cost of Acquisition Post Demerger

In the given example, if a shareholder had originally purchased 1,000 Ordinary Shares of Tata Motors Limited (TML) at ₹400 per share, the total cost of acquisition before the Demerger would be ₹4,00,000. 

Pursuant to the Demerger and based on the Share Entitlement Ratio, the shareholder would receive 1,000 equity shares of Tata Motors Commercial Vehicles Limited (TMLCVL). 

The total pre-demerger cost of ₹4,00,000 would then be apportioned between the two companies in the prescribed ratio. 

Accordingly, 1,24,600 (representing 31.15% of INR 4,00,000) would be attributed as the cost of acquisition for the 1,000 shares of TMLCVL, while the remaining ₹2,75,400 would be treated as the cost of acquisition for the 1,000 shares of TML, the Demerged Company.

Background of the Demerger

Under the approved Composite Scheme of Arrangement, Tata Motors separated its Commercial Vehicles business into a new entity (Tata Motors Limited) while retaining the Passenger Vehicles business under Tata Motors Passenger Vehicles Limited.

Each shareholder of the former Tata Motors Limited received one share of the new Tata Motors Limited (Commercial Vehicles) for every one share held in the demerged company.

The scheme came into effect on 1 October 2025, marking the formal operational split between the two divisions.

The restructuring aims to create sharper business focus, enable independent growth strategies, and enhance value creation for shareholders.

Tata Motors Passenger Vehicles Limited Share Price Performance

On 12 November 2025, Tata Motors Passenger Vehicles Limited’s stock closed at ₹402.15, down 1.30% from its previous close of ₹407.60.

The shares traded between a high of ₹411.40 and a low of ₹401.90 during the session.

Conclusion

Both Tata Motors Passenger Vehicles and Tata Motors Commercial Vehicles stocks are expected to remain in focus as investors assess post-demerger valuations and potential growth paths for each business.

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