Tata Motors shares fell nearly 40% in early trade on October 14, 2025, after the company completed its demerger into two separate entities — Tata Motors Passenger Vehicles Limited and TML Commercial Vehicles Limited.
The stock opened at ₹399 on the BSE, sharply lower than Monday’s closing price of ₹660.90. The decline came right after the company officially split its commercial vehicle and passenger vehicle businesses.
Why did Tata Motors shares drop?
Market experts explain that the steep fall is purely technical and not a cause for concern. It reflects the adjustment in the stock’s value after the demerger and does not impact investors’ total holdings.
Simply put, Tata Motors has now divided its commercial vehicle arm into a new company. As a result, the original Tata Motors stock now represents only the passenger vehicle business. The price drop shows that the commercial vehicle division has been separated — not that the company has lost value overall.
Shareholders panic
Even though market experts agree that the drop is not cause for panic, shareholders raised alarm over the red in their portfolios. Many took to social media to question and complain.
{{/usCountry}}Even though market experts agree that the drop is not cause for panic, shareholders raised alarm over the red in their portfolios. Many took to social media to question and complain.
{{/usCountry}}“How to survive with this fall?” asked one person.
X user Atul Karmakar admitted he was initially shocked.
“Initially stunned seeing the biggest ever 1 day notional loss in my portfolio, before realising today is the record date for Tata Investment split, *and* Tata Motors demerger. Phew,” he wrote.
X user Madhuri Tanwar similarly reported a “almost a mini heart attack”.
“Was not aware about TATA motors demerger update today, got almost a mini heart attack by looking at portfolio's P&L,” she wrote.