The stock listed on Wednesday at Rs 335 on the NSE, with a 28.5% premium to its implied value of Rs 260.75 and fell as much as 3.9% on Thursday to Rs 316.5, slipping 5.5% from its opening price. On the BSE, the stock traded down 3.9% at Rs 315 on the day, compared with its Wednesday opening of Rs 330.25, marking a 4.6% decline in two sessions.
The listing on Wednesday, November 12, was greeted with enthusiasm. The shares had briefly climbed 3% to Rs 345 in the previous session after listing at a premium. But the rally fizzled by the end of the day, with the stock closing 1.7% lower on the NSE at Rs 329.45 and 0.8% lower on the BSE at Rs 327.65.
The decline continued on Thursday, suggesting investors may be taking profits after the euphoric debut of the demerged entity.
Analysts see long-term value despite near-term volatility
Jahol Prajapati, Research Analyst at SAMCO Securities, said the demerger “separates the fast-growing passenger vehicle and EV business from the more stable, cash-generating CV business, allowing investors to value each on its own strength.”
The shareholders received one share of Tata Motors (CV) and one share of Tata Motors PV for every Tata Motors share held, so there’s no dilution of ownership.
Prajapati believes the CV arm remains integral to India’s growth cycle. “The CV arm is at the heart of India’s growth story, supporting logistics, mining, and infrastructure expansion,” he said. “With freight activity improving, commodity costs easing, and the GST rate cut from 28% to 18%, demand for commercial vehicles is expected to rise sharply. Fleet replacement and new demand from construction and logistics players will add further momentum.”
Tata Motors (CV) reported FY25 revenue of Rs 75,055 crore and EBITDA of Rs 8,856 crore, implying an 11.8% margin. Based on Ashok Leyland’s EV/EBITDA multiple of 12.9x, Prajapati estimated a fair value “around Rs 310–Rs 320 per share,” aligning closely with Thursday’s trading levels.
Summing up, he said, “The listing removes the ‘conglomerate discount’ and gives investors a focused bet on India’s commercial vehicle upcycle, with a steady, cash-rich, value-driven play backed by improving policy and economic tailwinds.”
Brokerages bullish on standalone CV play
Brokerages such as Ambit Institutional Equities remain upbeat, calling the split “a separation of value and growth propositions” and asserting that “the CV business is better positioned to capitalise on the demerger.” Ambit expects “immediate value unlocking for CV,” pegging TMPV’s residual value at around Rs 380.
SBI Securities earlier valued TMLCV between Rs 320 and Rs 470 per share, citing the company’s pending €3.8 billion acquisition of Italy’s Iveco Group NV’s commercial vehicle operations as a key catalyst for global expansion.
Iveco deal seen as long-term catalyst
Harshal Dasani, Business Head at INVasset PMS, said, “For investors, this listing presents a dual-edged opportunity: on the upside, a sharp, India-centric commercial vehicle play aligned with freight/logistics growth and infrastructure tailwinds; on the risk side, early-stage independent listing dynamics, margin cyclicality in CVs and execution discipline will be under close scrutiny.”
Dasani said that “the Iveco acquisition plan adds technological heft but will take time to reflect in earnings,” describing it as a “long-term strategic catalyst” that could position TMLCV as a global contender in the medium and heavy commercial vehicle space.
For now, Dasani said, “some volatility as passive funds rebalance post demerger” is to be expected, but “over the medium term, stronger GDP-linked demand, emission-led upgrades, and export opportunities could gradually lift the stock’s trajectory once integration benefits and capacity leverage start to play out.”
Also read | Tata Motors CV hits top gear on debut post demerger. Here are 7 takeaways from the listing
While Tata Motors (CV) shares have cooled sharply since their debut, analysts say the correction may be a healthy reset rather than a red flag.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)