1:1 Split Record Date: Tata Motors Demerger Effective On Oct-1; Eligibility, Listing Date, & Should You Buy?

Tata Motors' share price is going to see a significant change on October 1, 2025, as the company is scheduled to split into two separate listed entities. From Wednesday onward, the demerger of Tata Motors into TML Commercial Vehicles and Tata Motors Passenger Vehicles will be effective. The shares will be adjusted accordingly in the shareholders' demat account. However, what is the eligibility criteria to be part of Tata Motors' 1:1 demerger ratio, and should you buy the stock?

Tata Motors Share Price:

On Wednesday, at the time of writing, Tata Motors share price traded at Rs694.45 apiece on BSE, up by nearly 2% with market cap of Rs 2,55,715.56 crore. This Tata stock is trading near its intraday high of Rs 695.90 apiece. The stock is also among top bulls on Sensex and Nifty.

On the effective date of the demerger, Tata Motors share price performed closer to Rs 700 mark.

Before the demerger's effective date, Tata Motors share price stood at Rs 680.45 apiece on BSE, up by 1.2% after market hours on September 30th. The company's market value is at Rs 2,50,560.38 crore.

The heavyweight stock's 52-week high and low is at Rs 997.75 apiece and Rs 542.55 apiece respectively. Its price-to-equity ratio is at 29.09x, while return on equity stood at 28.12%. The earnings per share was at Rs 23.40.

Tata Motors Demerger Effective Date:

Tata Motors is splitting into two separate entities, one focused on commercial vehicles (CV) and the other emphasizing the passenger and JLR cars segment.

These two listed entities will be called TML Commercial Vehicles Limited and Tata Motors Passenger Vehicles Limited. After receiving the NCLT approval, Tata Motors fixed the effective date for the scheme of demerger on October 1, 2025.

It needs to be noted that the effective date is different from the record date to determine eligible shareholders for 1:1 demerger ratio. On October 1st, the company's corporate restructuring will come into effect.

Tata Motors Demerger Record Date:

The record date for the share swap ratio for Tata Motors demerger is yet to be notified.

In its regulatory filing, Tata Motors said, "The Company will separately notify the Effective Date of the Scheme and the "Record Date", for determining the Shareholders of the Company who shall be entitled to receive 1 (one) fully paid equity share in TMLCV (face value of Rs 2/- each) for every 1 (one) fully paid equity share of the Company.''

Hence, once the record date and allotment date are completed, the listing dates of the two entities will be announced accordingly.

Should You Buy Tata Motors Stock?

In its note, analysts at Emkay Global said, ''The Demerger expected to materialize mid-Oct (subject to ROC approvals); PV business to be retained in existing entity; CV business to be listed separately (likely early-Nov).''

The brokerage has recommended BUY for a target price of Rs 750.

The analysts highlighted that Tata Motors management upgraded the FY25-30 CV industry CAGR outlook to 6-8% (5-7% earlier) on recent GST cuts, with the immediate benefit of a 1-2% opex cut for fleet operators to directly aid the bottom line.

Also, the management is expecting double-digit CV industry growth in H2, including SVCs (vs flat H1). Pricing discipline/margin focus to continue in CVs. The company has recorded 25-30% booking growth from 5-Sep till Navratras (industry: 20%) and is predicting Q3 to see higher discounts to push volumes. After a flat H1, the management expects 7-8%/sub-5% PV industry growth in H2/FY26.

Additionally, the IVECO acquisition is transactionally prudent; concerns of EU exposure are captured in valuations (2.3x EBITDA). IVECO is to be EPS-accretive from Day-1; and TTMT targets ~20% RoCE for the combined entity.

Meanwhile, for JLR, US market remains resilient, China is holding up, and UK, EU are stable.

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