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I was checking out a stock named Ruchi Soya, that went from 18-25 to 480 in maybe 2 months. But the daily traded stocks are very less in number. There were days the stock price hit the upper circuit of a whooping 10%.

Anybody wanna shed some light on, how these things take place.

Here are the links for any further details: NSE and MoneyControl

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  • It's impossible to know without knowing the company. Could be reverse splits, an invention, winning a lawsuit, etc.
    – D Stanley
    May 11 '20 at 16:59
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    There was a take over, the stocks were merged and relisted in January, this is perceived as good and reflects in increasing share price... google.com/amp/s/wap.business-standard.com/article-amp/markets/…
    – Dheer
    May 11 '20 at 17:18
  • @nanoman's answer addresses this particular case, but in general, wouldn't something like this be a simple case of supply and demand? That is, the people holding the stock don't want to sell at the current price, but people want to buy - perhaps because they think the company is going to become the next Apple or Tesla. Therefore the people who want to buy offer much more than the last traded price to entice a few current holders to sell, which raises the price of the stock, which in turn encourages holders to hold out for more money.
    – jamesqf
    May 12 '20 at 4:03
  • @jamesqf That certainly is the case in general (truth is I don't know much about how these thing works, I'm still learning). BTW thanks for a generalized comment. May 12 '20 at 7:08
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This is not an ordinary case of a surging stock, but appears to be some kind of bizarre data glitch. The chart shows this stock trading normally (up and down, but in a long-term downtrend) until November 2019, then the data skips to January 2020, and since then the stock is shown as rising almost exactly 5.0% every trading day for months, resulting in an impossibly smooth exponential curve.

This is not a possible behavior of any traded stock (see this answer for why). It indicates that the "prices" shown are being calculated artificially and are not actual trade prices. Moreover, on the 1-day and 1-week charts where I would expect intraday movements to be shown, there are none, only daily prices. Given the apparent halt in November 2019, I wonder if the stock has since been trading at all. Perhaps a bug in the data service began to replace missing data with a calculation based on a notional 5% daily change.

A stock that received tremendous good news could rise a similar total amount in a similar time, but the rise would be much more irregular, with most of the gains concentrated in a few trading days, and many up and down days interspersed where traders recalibrated their expectations, took profits, etc.

EDIT: A news article linked by Dheer confirms that the stock was trading (in some sense) as of February 2020, but I still believe there were no actual shares bought or sold at the prices on the chart. Perhaps the daily limit was 10% at one point and then changed to 5%. The chart still does not reflect real prices. It is presumably based on a calculation that assigns a closing "price" when no trades happened. And the reason I believe no trades happened is that no one would sell at today's "price" knowing the "price" will be 5% higher tomorrow.

Rather, I suspect there is a bid/ask that has been very high for a while and has been following the "irregular" pattern I described above. But this bid/ask has not resulted in any shares changing hands, because the exchange artificially prohibits trades at prices that increase more than 5%. Then, the exchange presumably calculates an "official daily close" which is limited to a 5% move in the direction of the bid/ask. This official (artificial) price has been playing catch-up for months. A very unusual situation.

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  • Thanks @nanoman! I was very curious about this stock. Thanks for the analysis review. May 11 '20 at 18:51

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