Shares of Tata Motors Ltd were trading in the red and 3% lower on 2 August after the Board of Directors of Tata Motors approved the demerger of its commercial vehicle business into TML Commercial Vehicles Limited and announced that its passenger vehicles businesses, including EV, JLR, PV, and related investments into another entity. 

The demerger will result in creating two listed companies with same shareholding, which will include the CV business and the other company housing the PC business. 

The demerger will be carried out through an NCLT scheme of arrangement, maintaining identical shareholder positions in both listed entities. 

Tata Motors indicated in March that this move allows each business to adopt distinct strategies and enhance shareholder value. 

The scheme requires approval from shareholders, creditors, the National Company Law Tribunal, and other relevant authorities.

Through this demerger, the company aims to enhance the synergy between the PV and EV business along with JLR, with a strong focus on the EV, autonomous vehicles, and vehicle software areas. 

At 11:45 am, the shares of Tata Motors were trading % lower at Rs 1,104.15 on NSE.

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