At the 79th annual general meeting, Tata Motors announced its plans to demerge passenger and CV businesses by 2025. Apparently, the proposed demerger of its existing automotive businesses into two listed entities will enhance synergies between its various divisions. The PV business will include EV, JLR and related investments, in another entity.
Tata Group chairman N Chandrasekaran highlighted the macro – economic scenario, the performance of three businesses, viz., Commercial Vehicles (CV), Passenger Vehicles (PV) & Electric Vehicles (EV) and Jaguar Land Rover (JLR) in FY 2023-24.
He further discussed the corporate actions undertaken and key focus areas of the Company in future under each of its businesses which includes improving financial strength, enhancing customer experience, the strategies to improve market share, brand strength as well as meeting growth aspirations and proposed demerger of the Company into two separate listed entities.
According to a leading media daily, Chandrasekaran announced that the proposed demerger of PV and CV businesses would help secure synergy among electric vehicles (EVs), autonomous vehicles and vehicle software.
In the meeting, P B Balaji, Group Chief Financial Officer made a presentation covering, inter-alia, business highlights of the Company comprising of CV, PV & EV and JLR detailing their respective Revenue, EBIDTA, PBT and FCF. He proposed demerger of the Company into two separate listed entities and highlighted that the demerger will retain flexibilities for the exit route of investors in the firm’s electric vehicles business.
This demerger would allow each entity to focus more effectively on delivering superior customer experiences, providing better growth opportunities for employees, and enhancing shareholder value. Meanwhile, Tata Motors will soon be launching Curvv SUV, Sierra EV and Nexon CNG.