NCLT Clears Tata Motors’ Plan to Demerge PV and CV Divisions from October 1, 2025

Tata Motors has received approval from the Mumbai bench of the National Company Law Tribunal (NCLT) to separate its passenger vehicle (PV) and commercial vehicle (CV) businesses. The tribunal cleared the composite scheme of arrangement on August 25, 2025, with a rectification order issued on September 10, 2025. As per the news reports, the demerger will take effect from October 1, 2025.

Structure of the Demerger

The CV business will be moved into a new entity named TML Commercial Vehicles Ltd (TMLCV). The PV business will remain with Tata Motors, which will be renamed Tata Motors Passenger Vehicles Ltd. Both companies will be listed separately on the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE).

As part of the arrangement, shareholders of Tata Motors will receive one share of TMLCV, with a face value of ₹2, for each share they currently hold. In addition, non-convertible debentures worth ₹2,300 crore will be transferred to the CV entity.

Leadership Changes

The company has announced new leadership for both entities. Girish Wagh, who has been leading the CV division, will become Managing Director and Chief Executive Officer of TMLCV. Shailesh Chandra, currently heading Tata Passenger Electric Mobility, will be Managing Director and CEO of Tata Motors (PV) for 3 years ending September 30, 2028.

Group Chief Financial Officer P.B. Balaji will step down on November 17, 2025, to take charge as CEO of Jaguar Land Rover Plc in the UK. Dhiman Gupta, presently CFO of Tata Passenger Electric Mobility, will succeed him as Group CFO of Tata Motors and continue as a non-executive director on the board.

Board Reconstitution and Incentives

Independent directors Hanne Sorensen, K.V. Chowdary and Guenter Butschek will move to the TMLCV board. Tata Motors has appointed Sudha Krishnan, a former Indian Audit and Accounts Service officer, as an independent director.

The company has also cleared the second tranche of its 2024 long-term incentive plan. A total of 4,79,746 performance share units will be granted to 384 employees across Tata Motors and its subsidiaries.

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Tata Motors Share Price Performance 

As of 10:09 am on September 29, 2025, Tata Motors share price was trading at ₹676.80, a 0.58% increase from the previous closing price.

Conclusion

With the NCLT’s approval, Tata Motors will operate its PV and CV businesses as separate listed companies from October, with independent leadership and boards.

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