Shares of Tata Motors fell sharply on Tuesday, showing a fall of nearly 40% on some trading apps as the company’s stock started trading ex-demerger. The fall, however, is not due to a market crash or poor performance, but because the company has spun off its commercial vehicle business from the passenger vehicle arm.

The demerger means that for every one share of Tata Motors held as of the record date, investors will get one share of the new commercial vehicle entity. The drop in share price reflects the separation of the commercial vehicle business from Tata Motors’ main stock and not a loss in value for investors.

Tata Motors shares opened at Rs 399 on Tuesday, down around 39.62% from Monday’s close of Rs 660.90. Following the price adjustment, the company’s total market capitalisation

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