Key Points
The demerger of Tata Motors into two separate listed entities - CV and PV - will eventually lead to the exclusion of the smaller stock (commercial vehicles unit) from Sensex and Nifty just like what happened during the demerger of Jio Financial Services from Reliance Industries (RIL)...
However, once the demerger is complete, with the smaller entity (CV business) becoming a standalone entity, it will exit Nifty50 and Sensex..
He said global indices MSCI and FTSE will evaluate the smaller entity's market cap around listing to determine its eligibility...
The key factors will be the market cap (Total and Free Float) of Tata Motors shares and the global cutoff levels," Pagaria said.. BNP Paribas has valued the PV business at Rs 583 per share and CV business at Rs 336 per share...
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