TATA MOTORS VS. TATA MOTORS DVR
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TATA MOTORS
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TATA MOTORS DVR
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Price
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Rs 256.75
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Rs 156.1
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Voting Rights
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1 per share
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1/10 per share
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Dividend
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As declared in AGM
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5% in addition to regular shares
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Face Value
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Rs 2
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Rs 2
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Logic to buy TATA Motors DVR instead
of TATA Motor shares:
- Both shares enjoy same level of share in the national and international growth of the company equally.
- Higher dividend and lower investment price means higher dividend yield.
- Differential voting rights does not make sense for retail investors as any case their opinion does not matter to anyone.
- Globally, DVR quote 10-20% discount to the main stock wherein we can easily see this difference to be 39% in case of TATA Motors. Even taking in to account higher 20% as discount rate, it given enough room for 25% appreciation in the stock.
- If one is convinced about the long term story of Tata Motors simply go and buy Tata Motors DVR. Sooner or later stocks will follow international tread of valuations
Disclosure: The author or his immediate family members do not own any
shares in either of Tata Motors or Tata Motors DVR.
