Tata Group is an Indian multinational company, and is also one of the biggest conglomerates in India. Tata Group deals in many businesses and has acquired many companies be it in automobile industry, technology industry, financial industry, steel industry, etc. and Tata motors is one of its vast businesses.
Not only this Tata also provides safe and secure trading platforms. Discount broking app Upstox is owned by Tata, and is aiming for a 10-times hike in its customer base in next 5-6 years. Tata Group allows trading in many stock shares and stock exchanges and one of them is Tata Motors DVR!
Tata Motors DVR: An Overview
Tata Motors was the first one to start DVR in India back in 2008. DVR is termed as Differential Voting Right shares of Tata Motors ltd. and are listed on stock exchanges with different terms and conditions than the ordinary shares. These DVR shares are different from the ordinary shares, in DVR the shareholders get more dividends than regular shareholders. It is generally issued to raise equity capital without changing its management.
One of the basic differences between them is that DVR shares are available at a much lower price than the ordinary shares, which makes it a go to choice for the shareholders to invest in it.
While there are some major differences between ordinary shares and DVR shares that can help in better understanding of these two.
- First one is the dividend count – Tata DVR shares pay a higher dividend premium in order to compensate for lower voting rights. This can be an ideal go-to choice for small and retail shareholders of a company as they generally do not participate in the voting process. Tata DVR has consistently declared dividends over the years. The dividend percent is around 10-20%. Along with it, Tata DVRs have always been quoted at a highly discounted price.
- Second one to notice is the Voting Rights difference. According to the Section 47 of Company Act 2013, each member of a company that is limited by shares in addition to holding an equity share capital will have a right to vote on every resolution related to the company. Tata Motors DVR offers lower voting rights as compared to ordinary shares and has a 10% voting rights as compared to other Tata Motors ordinary shares.
Note: Tata motors is a blend of new technology and innovation over the time and is one of the biggest automotive companies. To get some more information about it and insights of it, visit the article Tata’s Biggest EV Ambitions.
Tata Motors Vs Tata Motors DVR
For about the last 5 years, Tata Motors and Tata Motors DVR are in sync with each other, but let’s see some main factors to differentiate between them.
| Parameter | Tata Motors | Tata Motors DVR |
| Voting Rights | 1 vote is allotted per ordinary share. | 1 vote is allotted per 10 ‘A’ ordinary shares. |
| Returns (last 5 years) | -9.72% | -16.17% |
| Dividends | Has a regular rate of dividends. | Gets a percentage rate higher than the regular rate of dividends. |
| Net Sale from Operations | Rs.65,298.8 crores | Rs.65,298.8 crores |
| Total Income | Rs.65,757.33 crores | Rs.65,757.33 crores |
| Price | Rs.647 per share (2023) Rs.490 per share (2022) | Rs.425 per share (2023) Rs.234.7 per share (2022) |
Note: As stated above both Tata Motors and Tata Motors DVR are in sync with each other since the last 5 years and are at head-to-head count in numbers. Be it the total expenses, profits, loss, earnings per share, etc. both have nearly the same numbers.
Tata Motors vs Tata Motors DVR: NSE Price Comparison (however it may change overtime)
| Year | Tata Motors | Tata Motors DVR |
| 2023 | Rs.721.80 | Rs.481.35 |
| 2022 | Rs.387.95 | Rs.205.65 |
| 2021 | Rs.482.80 | Rs.239.35 |
| 2020 | Rs.175.95 | Rs.72.85 |
| 2019 | Rs.176.95 | Rs.72.65 |
The NSE (National Stock Exchange) prices for the last five years of both Tata Motors and Tata Motors DVR, it is pretty much clear that Tata Motors share prices are always higher than its DVR share prices.
Tata Motors NSE price back in 2019 was Rs.176.95 and today it has its share price rising to Rs.721.80, while Tata Motors DVR has its NSE share price back in 2019 was Rs.72.65, and today it has its share price rising to a good number of Rs.481.35. However, the numbers may change over time!
The latest market cap of Tata Motors Ltd, for the year 2023 is Rs.2,64,236 crores, on the other hand the market cap of Tata Motors DVR is Rs. 24,492 crores.
Note: Tata Motors market cap for the year 2024 is 3,27,699 crores. Also Tata Motors gain 3% nod on DVR share conversion, soared around 88% in 2023.
It is pretty much observable that Tata Motors with its high share price is currently at the forefront, while with its lower and affordable share prices for small investors Tata Motors DVR is behind Tata Motors with a market cap of Rs.24,492 crores.
Consider the fact
Tata Motors in July 2023 announced that they will be cancelling down their DVR shares in order to simplify their capital structure. With this the DVR shareholders will get 7 ordinary shares for every 10 DVRs held by the investors, this will work out for the investors of DVR as they’ll get a premium of 23% close to the DVR shares and a 30% discount to the Tata Motors ordinary shares.
This turned out to be a big bonus deal for DVR shareholders as they’ll get a big package deal without even spending much. According to the chairman of Tata Motors DVR, N Chandrasekaran, shutting down DVR shares will cost them about Rs.100 crore due to stamp duty. However, this entire activity will require around 12 to 14 months to come into action.
Summing Up
Tata Motors DVR shares seems to be a good option for small investors looking for investing opportunities, however, Tata Motors is considering shutting down their DVR shares in the upcoming months.
