Tata Motors is splitting its business into two separate listed companies. One company will focus on commercial vehicles (trucks, buses, pickups), while the other will handle passenger vehicles, electric vehicles, and Jaguar Land Rover.
For every 1 share of Tata Motors you hold, you will receive 1 share of Tata Motors Commercial Vehicles (TMLCV). If you bought shares on or before October 13, 2025, you qualify for the demerger. For example, if you own 100 Tata Motors shares, you will continue holding 100 Tata Motors shares and receive 100 shares of Tata Motors Commercial Vehicles. The record date is October 14, 2025.
Trading timeline
- Tata Motors (October 14, 2025): A special pre-open session runs from 9:00 AM to 9:45 AM where you can place, modify, or cancel orders. Order matching happens at the end of the session. Regular trading resumes from 10:00 AM to 3:30 PM.
- Tata Motors Commercial Vehicles (TMLCV): Shares will be credited to your demat account within 30-45 days from the record date. CDSL will email you once they credit the shares. The exchange will list Tata Motors Commercial Vehicles separately on NSE and BSE after regulatory approvals, with the exact listing date announced through a separate circular.
- F&O contracts: All existing F&O contracts expiring in October, November, and December will expire on October 13, 2025, and be reintroduced with a revised lot size from October 14, 2025, after the special pre-open session as per NSE circular.
Average price adjustment
The company has not yet announced the cost of acquisition (COA) ratio. Once the company announces the ratio, Zerodha will adjust the buy average for your Tata Motors holdings and the new Tata Motors Commercial Vehicles shares accordingly.
For example, if you bought 100 shares at ₹950 each (₹95,000 total) and the value splits 60:40, your adjusted cost prices become ₹570 per Tata Motors share (60% of ₹950) and ₹380 per Tata Motors Commercial Vehicles share (40% of ₹950). The combined cost remains ₹950, divided between two stocks.
Tax implications
Your holding period counts from your original Tata Motors purchase date, not the demerger date. Tax applies only when you sell:
- Long-term holdings (>12 months): 12.5% tax on gains above ₹1.25 lakh
- Short-term holdings (<12 months): 20% tax
You can post questions about the demerger on TradingQnA.