Automaker Tata Motors has approved the decision to split its passenger vehicles and commercial vehicles businesses into two separate companies. This has been sealed in the meeting of the board of directors held on Thursday, and the process is likely to take 12 to 15 months.

The Board of Directors of Tata Motors approved the combined scheme of TML, TML Commercial Vehicles Limited (TMLCV), Tata Motors Passenger Vehicles Limited (TMPV). The board approved the merger of the commercial vehicle business into TMLCV and another company is planned for the passenger vehicle business, including passenger vehicles, electric vehicles and JLR. This means that existing Tata Motors will be divided into two separate companies. As a result, the shareholders of Tata Motors will receive shares in both the newly formed companies. Both these companies will be listed separately in the capital markets.

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Substantial increase in profits

Tata Motors posted a net profit of Rs 5,566 crore in the quarter ended June. There has been an increase of 74 percent compared to the year. Revenue has increased by 5.7 percent to Rs 1,07,316 crore.