Tata Motors CV shares listed at a 28% premium on November 12 but soon fell to ₹326. The demerger shows long-term benefits for the company, but experts have advised investors to remain cautious for now.
Following Tata Motors' demerger, shares of Tata Motors Commercial Vehicles (TMCV) were listed on Tuesday, November 12. However, despite a b debut, the shares slipped shortly after listing. On the NSE, the shares listed at ₹335 and on the BSE at ₹330.25, which was approximately a 28% premium over the issue price of ₹260.75. However, after hitting an intra-day high of ₹345, they slid to ₹326.
What Benefits Did the Demerger Bring to the Company?
Following Tata Motors' demerger, the company's passenger and commercial vehicle segments have been completely separated. Market experts consider this move positive for both the company and its shareholders.
According to Ambit Capital, Tata Motors' commercial vehicle segment is in a b position. Its top market position, industry-aligned margins, and b cash flow generation can support the company's revaluation.
The brokerage house believes that global presence and the Iveco acquisition can further accelerate the company's growth. The demerger is expected to bring benefits such as strategic focus, operational independence, and improved market valuation to the company.
Why Did the Share Price Fall After Listing?
Immediately after listing, the share saw a decline of up to 3%. Market experts state that the recent decline in Tata Motors shares and technical adjustments post-listing have led to volatility.
Additionally, short-term fluctuations in the share price may persist due to index and portfolio adjustments.
Expert Opinion: Buy, Sell, or Hold?
Abhinav Tiwari, Research Analyst at Bonanza Portfolio, states that investors should adopt a cautious approach for now. He advised placing the share on a watchlist instead of buying immediately, and monitoring market conditions for some time.
While the company's fundamental position is b, it would not be advisable to make a hasty entry due to technical risks and volatility.
