Business. There was a lot of movement in Tata Motors shares during early deals on Tuesday (March 5). On the second trading day of the week, the company’s shares were seen trading at Rs 1028.80 with a rise of 4.16 percent. The company’s stocks also hit a high of Rs 1,065.60 (with a gain of about 5%) during the trading session. This rise in shares has come after the announcement made by the company on Monday, according to which it has been said that the company will be divided into two separate entities.
According to the announcement made by the company, one unit will include the commercial vehicle business and its related investments, while the other unit will include all the passenger vehicle businesses including passenger vehicles, electric vehicles and JRL and their related investments.
In a communication sent to the stock exchanges, Tata Motors said that the shares of all Tata Motors shareholders in both the listed companies will remain the same. The company said, “Over the past few years, Tata Motors’ commercial vehicles (CV), passenger vehicles (PV+EV), and Jaguar Land Rover (JLR) businesses have delivered strong performance by successfully implementing differentiated strategies ” As of 2021, these businesses have been operating independently under their own separate CEOs, according to the company.
Tata Motors Share Price
Tata Motors said the demerger may take 12-15 months to complete and will not have any adverse impact on employees, customers and business partners. Recently, Tata Motors announced that sales in the domestic and international markets for February 2024 stood at 86,406 units compared to 79,705 units for February 2023. It had registered an increase of 8% on an annual basis. Total sales in the domestic market stood at 84,834 units, up 9% year-on-year.
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On the other hand, domestic commercial vehicle sales declined by 4% to 33,576 units. Whereas domestic passenger vehicle sales have increased by 20% year-on-year to 51,267 units in February 2024.
Tata Motors Share Price
Market experts believe that this step of demerger has been taken to further strengthen each segment of the company. This decision has been taken to achieve higher growth rate with a new vision. This is a much awaited and strategic step. This decision of the company should be seen as logical progress. Auto sector experts believe the demerger will help Tata Motors better capitalize on growth opportunities and enhance value for long-term shareholders.
