Tata Motors split: Record date on October 14, shares crash over 9% in 5 sessions. What next for investors?

Shares of Tata Motors continued their downward trajectory on Thursday, falling for the fifth straight session ahead of the company’s crucial record demerger date on October 14. The stock has corrected 9.5% in the last five trading days to hit a low of Rs 669 on the BSE as investors brace for operational and structural shifts related to vertical separation.

The upcoming 1:1 demerger will result in the formation of two separate listed entities, Tata Motors Passenger Vehicles and TML Commercial Vehicles, with shareholders receiving one fully paid up share of TMLCV for every share in Tata Motors.

The aim of this move is to separate the company’s commercial and passenger car divisions, including electric vehicles and the Jaguar Land Rover (JLR) business, into independent units with a sharper operational focus.

Saurabh Jain, head of Fundamental Research at SMC Global Securities, said the recent market correction reflects “profit booking and near-term uncertainty” surrounding the restructuring.

“Strategically, the demerger aims to sharpen operational focus and unlock value, allowing each entity to pursue independent growth and attract more appropriate valuations,” Jain added. He also noted that clarity in the structure could lead to stronger long-term value creation for shareholders

Adding to the volatility, all Tata Motors Futures & Options (F&O) contracts expiring in October, November and December will now end early on October 13, with mandatory physical settlement at the closing price of that day. Trading restrictions have also been imposed on new positions in F&O and Margin Trading Facilities (MTF) from October 8, as exchanges look to curb sharp price movements in the run-up to the split. also includes transfer of Rs 2,300 crore worth of non-convertible debentures (NCDs) to TMLCV, for which the record date is set at October 10, 2025.

The shares of both the new entities are proposed to be listed on BSE and NSE, subject to regulatory approval.

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While the short-term trend has turned cautious, with shares under pressure in the run-up to the record date, analysts suggest the creation of two focused companies could enable clearer value discovery in the long term.

(Disclaimer: Recommendations, suggestions, views and opinions expressed by the experts are their own. These do not represent the views of The Economic Times)