October 14 marked the record date for the separation of Tata Motors’ passenger and commercial vehicle businesses. Shareholders who held Tata Motors stock before that date will receive one share of Tata Motors Commercial Vehicles Ltd (TMLCV) for every share held. The company expects shares to be credited within 30–45 days, pending regulatory approvals, after which TMLCV will list separately on the NSE and BSE.
The Rs 260.75 implied value for the CV arm is derived from Tata Motors’ pre-demerger closing price of Rs 660.75 and the Rs 400 opening price of the renamed parent, Tata Motors Passenger Vehicles Ltd (TMPV).
Unlocking value, but when?
Brokerages said the demerger enables clearer valuation of Tata Motors’ distinct businesses. “So, sum total our sense is that there should be value creation because what we are expecting for CV business is 11 times EV/EBITDA on FY27 basis, so that comes about Rs 300 odd because comparable peers are also getting similar multiples,” said Pankaj Pandey of ICICI Securities.
“On the PV side, our sense is that stock should trade somewhere in the range of 450 to 500, that is the fair value we see. So, since it is a sort of a vertical split and it is one of the most anticipated demerger our sense is that sum total there should be some value creation because both PV and CV business are offering different growth trajectories,” said Pandey.
Brokerages turn bullish on CV arm
Nomura valued the passenger and commercial vehicle units almost equally—Rs 367 for TMPV and Rs 365 for TMLCV—while cautioning of “technical risk for the share price” as the stock trades ex-demerger. The brokerage noted that index weight adjustments could trigger near-term volatility.Ambit Institutional Equities described the spin-off as “a separation of value and growth propositions,” adding that the CV business is “better positioned to capitalize on the demerger” given its market leadership, industry-matching margins, and steady cash generation. Ambit said it expects “immediate value unlocking for CV,” with the residual listed entity’s price likely to settle around Rs 380 per share.
The brokerage added that global reach and synergies from the planned €3.8 billion acquisition of Iveco Group NV’s commercial vehicle operations would provide “re-rating upside.”
SBI Securities, meanwhile, projected TMPV to trade between Rs 285–384 post-demerger, with potential upside tied to JLR’s volume recovery and profitability. For TMLCV, the brokerage forecast a range of Rs 320–470, noting the planned €3.8 billion acquisition of Iveco Group NV’s commercial vehicle operations.
Trucks, buses and a global play
TMLCV enters this new phase as India’s largest commercial vehicle maker, with a 37.1% market share and a 12.2% EBITDA margin in Q1FY26, despite a recent decline in revenue. Analysts at Nomura said the Iveco acquisition could be transformative, tripling combined revenues and expanding exposure to electric and alternative fuel powertrains.
Ambit noted that the CV arm is “a consistent cash generator,” with positive free cash flow, unlike the passenger vehicle division, which remains in an investment-heavy phase. The Iveco deal, it said, would help Tata Motors “diversify away from domestic cyclicality” and “expand its global footprint in Europe and Latin America.”
Also read | Tata Motors demerger: Trucks and buses business valued at Rs 260.75 per share
What shareholders should expect
For now, shareholders can only wait for the CV stock to debut—likely by late November or early December. Until then, the Rs 260-a-share value remains implied.
Analysts expect volatility in the near term as the market recalibrates to the new structure. But brokerages remain optimistic about the long-term story. As Ambit noted, the demerger “supports Tata Group’s broader agenda of streamlining its business structure and driving shareholder value through enhanced transparency and governance.”
For 67 lakh Tata Motors investors, that “value unlocking” moment may be just around the corner.
Also read | TCS, Tata Motors tumble up to 42% from peak, with over Rs 4 lakh crore wiped off Tata stocks in 2025 amid boardroom turmoil
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)
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