Ruchi Soya becomes multi bagger in just 5 months.Gained 8,819 Percent

Many of the brokerage firms and Fund manager are regretting their decision to not buy Ruchi Soya. After acquisitions of ruchi soya by Ramdev baba’s Patanjali group Ruchi Soya relisted in the stock market for trading but not all the traders got his stocks as the patanjali goup own 98.87 % of stacks. Very limited volume for public trading and whoever got this stock right after the relisting become the gladdest person.

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Earlier ruchi soya was suffering due to corporate insolvency and then in September 2019 Patanjali group came in as a rescuer and acquired the company at 4,500 crore. In January stock got relisted and resumed trading at 16.10 and closed on 16.90 on BSE. Right after the five months of relisting the stock on June 26^th the stock closed at 1507.30 on BSE in these 5 months the stocks has seen unexpected rise of 8,819% which means if you have invested 10,000 on this stock at the time of relisting then you would end up gaining 881,900. Almost 9 lakhs rupees out of ten thousand in just five month.

The stock has developed as a lockdown winner as it raised more than thousand percent in March month. Some the of the fund manager said, this stock is giving me sleepless night as they have opportunity to buy but they couldn’t.

With this much rise Ruchi Soya Surpasses the FMCG Giant Marico and become top 100 most valuable company in terms of market capitalization. Ruchi Soya is having a market capital worth of Rs 44,592.11 crore on the other hand Marico has Market cap worth of Rs 44,495.88 crore.
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The major reason for almost 9000 percent rise in ruchi soya is its inherent value. Expert said during the relisting period the stock was undervalued and therefore market turned in favor of this stock and given the rise which was necessary. But according to insider sources we got to know that there was circular trading was going on this stock to increase the price. It was patanjali’s group’s strategy to have on board expert traders and do circular trading for at least 3 months of time.

So should you buy this stock or not?

As per our stock analyst Mr. Sanket Savaliya, you shouldn’t invest in this stock and be careful with such stocks at present Ruchi soya is having very low float rate which is 0.97. Therefore the stock is not reflecting its true value hence you shouldn’t be buying share. You can buy only after the pantajali group reduces its shareholding and this will take time. As per current rules of SEBI the company will have to increase the public shareholding by 10 percent in 18 months of relisting and 25 percent in 3 years. You can’t wait till the time as many other stocks are also gaining momentum so it’s better to forget this stock and keep eye on other who has true potential of becoming another multi bagger stocks.

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