Why TATA Motors Share Is Falling?

Tata Motors shares have fallen sharply in the past 24 hours, dropping nearly 40% at one point—a move driven not by market panic or business failure, but by the completion of a major corporate demerger. This article explains everything you need to know about why Tata Motors share price is falling, what the latest data from this historic split tells us, and what it means for new investors considering buying Tata Motors shares right now.

Tata Motors Share Price: 24-Hour Data

In the last trading session—October 14, 2025—Tata Motors stock opened at around ₹400, sharply down from the previous close of ₹660.75, reflecting a 39.5% drop. However, this reduction is a technical adjustment due to the demerger; the actual investment value for shareholders remains intact, now spread between two entities. The table below highlights the key share price movements and trading statistics from the last 24 hours:

Source: Latest reports from Moneycontrol, Economic Times, and Hindustan Times.

Why Did Tata Motors Shares Fall? Demerger Explained

The sudden and steep decline came as a result of Tata Motors’ demerger—its commercial vehicle (CV) division was split off into a separately listed entity, TML Commercial Vehicles Ltd (TMLCV).

• What does this mean for investors? Shareholders who held Tata Motors shares as of the record date (October 14, 2025) will receive one share of the new commercial vehicle entity (TMLCV) for each Tata Motors share they own.
• The new structure: Tata Motors Passenger Vehicles (TMPVL): Focused on passenger vehicles, electric vehicles, and Jaguar Land Rover (JLR).
• TML Commercial Vehicles (TMLCV): Handles commercial vehicles—India’s largest in its sector, 37.1% market share.
• Price adjustment: The fall in Tata Motors’ share price represents the removal of the commercial vehicles business from the main company’s valuation.
• Full value restoration: Total investment value will be realized when both entities (TMPVL and TMLCV) are trading—a process expected to complete by November 2025.

This technical adjustment does not represent a loss for long-term investors but is a realignment reflecting the changed structure of the company’s assets.

Market Reaction and Analyst Perspectives

Despite the volatility, major brokerages and analysts remain optimistic about the future value-creation opportunity presented by the restructuring. Here’s what leading experts say:

• YES Securities: Maintains a ‘buy’ rating, sees strong unlocking of value once both CV and PV entities are listed independently.
• Nomura: Values the commercial vehicles entity (TMLCV) at ₹365/share and the passenger vehicles arm at ₹367/share, anticipating growth driven by new launches and strong demand in EVs and CNG.
• Goldman Sachs: Separately values JLR at ₹236, India PVs at ₹130 and Commercial Vehicles at ₹306, all per share, suggesting a consolidated valuation of ₹700 per share before the split.
• Nuvama: Values TMPV at ₹410/share, with further breakdown for PV, JLR, China JV, and Tata Technologies.
• Bonanza: Expects the separation will sharpen business focus and recommends patience until both entities are fully established in the market.

Technical and Fundamental Insights

Fundamental Ratios (TTM, as of October 2025)

TMPV is expected to grow 8–10% in H2FY26 thanks to new launches, robust SUV sales, and rising EV/CNG demand. Meanwhile, TMLCV holds a dominant position in India’s commercial vehicles sector with 37.1% market share, which should appeal to investors seeking exposure to commercial auto cycles.

Technical Chart Analysis

• RSI (Relative Strength Index): At 44.2, indicating neutral momentum.
• MACD (Moving Average Convergence Divergence): At -1.1, suggesting bearish near-term sentiment.
• Moving Averages: Trading below 20-week EMA of ₹688; resistance at ₹670 and key breakout above ₹715 needed for renewed momentum.

Corporate Events and External Factors Impacting Tata Motors

Several extraneous factors could add to volatility in Tata Motors’ share price in the short term:

Jaguar Land Rover Cyberattack

Jaguar Land Rover, the UK-based subsidiary, underwent a phased restart of operations after a cyberattack disrupted production in September 2025. This resulted in:

• 24% drop in wholesale volumes
• 17% decline in retail sales for the September quarter
• Estimated £50 million loss per week, with full recovery post-Christmas

General Boardroom Volatility in Tata Group

In 2025, broader Tata Group stocks also saw major price adjustments due to internal boardroom events, but these are not directly linked to the Tata Motors structural adjustment.

How Safe Is Tata Motors for New Investors?

If you are new to the share market and considering buying Tata Motors post-demerger, here are key points to keep in mind:

Pros

• Focused Business: Each entity is now focused—TMPVL on passenger/EV/JLR, TMLCV on commercial vehicles—making your investment clearer and offering targeted growth opportunities.
• Strong Growth Prospects: Both arms are market leaders in their segments, and expected to benefit from sectoral growth in India’s auto market, especially in EVs and CNG.
• Fair Price Discovery: The special BSE/NSE pre-open sessions for demerged entities help minimize volatility and allow price discovery to start transparently.

Cons

• Short-Term Volatility: There will be uncertainty while the market settles and both stocks are listed, as analysts expect trading swings until both businesses stabilize.
• Event Risks: Ongoing issues—like cyberattacks at JLR or macroeconomic changes—can cause further short-term movements in share price.

Risk Mitigation Steps for New Investors

• Hold Positions: Avoid fresh entry until clarity emerges post-listing of both entities.
• Watch for Breakout Levels: Technical analysis recommends waiting for a sustained rally above ₹715 for bullish momentum.
• Diversify: Combine Tata Motors’ new entities with holdings in other market sectors to minimize risk.

Step-by-Step Guide for New Share Market Investors: How to Buy Tata Motors Shares Safely

1. Understand the Demerger: Ensure you’re aware of which business arm you are investing in—TMPVL (Passenger Vehicles) or TMLCV (Commercial Vehicles).
2. Monitor Listings: Wait until TMLCV begins trading (expected November 2025) to see full price/value of both entities.
3. Research Analyst Ratings: Check major broker values (Nomura, Goldman Sachs, YES Securities) for guidance.
4. Use Technical Tools: Track support and resistance for Tata Motors using RSI, MACD, and key moving averages.
5. Diversify Portfolio: Include other reputable auto sector stocks to reduce concentration risk.
6. Invest via Trusted Brokerage: Use NSE/BSE platforms, validated brokers like Zerodha, ICICI Direct, or HDFC Securities for best rates, fast execution, and research support.
7. Monitor Regulatory Updates: Watch for SEBI, BSE, NSE announcements regarding finalized listing dates, record dates, and special trading sessions.
8. Long-Term Focus: Invest for the medium-to-long term, especially if holding through sectoral or organizational restructuring.

Frequently Asked Questions (FAQs)

Q: If I buy Tata Motors today, do I get shares of both entities?

• Only investors holding shares as of October 14, 2025, the record date, will receive TMLCV shares. If you buy after this, you invest in TMPVL until TMLCV begins trading.

Q: Is this fall a real loss in market value?

• No. The drop is a calculated technical adjustment after the business split; the total value should recover when both stocks trade independently.

Q: Which Tata Motors business has better growth prospects?

• TMPVL expects 8–10% growth in PV/EV/JLR, strong in SUVs and electric/CNG models; TMLCV is dominant in commercial vehicles—both show long-term promise.

Conclusion

The sharp fall in Tata Motors shares is a technical and strategic market adjustment following the historic split of its commercial and passenger vehicle businesses. The core investment value remains intact and is expected to be restored as both arms of Tata Motors start trading independently. For new investors, it’s crucial to understand this context, monitor technical signals, follow analyst guidance, and adopt a medium- to long-term view for best results in India’s dynamic automotive sector.