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Tata Motors Splits Businesses, Investors Brace for Volatility
13 Oct
Summary
- Tata Motors restructuring aims to "unlock value" for investors
- Cyberattack disrupted Jaguar Land Rover's production, causing losses
- Analysts cautiously optimistic about post-restructuring rally and JLR restart
On October 1, 2025, Tata Motors initiated a major restructuring, separating its commercial and passenger vehicle businesses. The move, which became effective after approvals from the National Company Law Tribunal's Mumbai Bench, aims to "unlock value" for investors. However, the restructuring has created short-term volatility, with Tata Motors' shares sliding 7% over seven sessions and hitting ₹679.05 on October 14.
The company's UK-based subsidiary, Jaguar Land Rover, also faced a setback in the third quarter of fiscal year 2026 due to a cyberattack that disrupted global production. The incident caused a 24% drop in wholesale volumes and a 17% decline in retail sales, with estimated losses of £50 million per week. Analysts expect JLR's production to gradually resume post-Christmas, which should support the company's sentiments.
Despite the short-term challenges, analysts remain cautiously optimistic about Tata Motors' restructuring. They believe the separation of the commercial and passenger vehicle businesses will unlock value for investors, as they will now have the opportunity to play the auto cycles of each vertical separately. The passenger vehicle, electric vehicle, and Jaguar Land Rover businesses will be housed under the renamed Tata Motors Passenger Vehicles Ltd, while the commercial vehicle operations will be focused on under the new Tata Motors Ltd.
