The curious case of Ruchi Soya shares

The curious case of Ruchi Soya shares:

Ruchi shares, which were relisted at Rs 17 after equity restructuring, have been locked at the upper circuit for the past 70 trading sessions since January 27.

It has been a dream run for investors in Nutrela-maker Ruchi Soya stock as it has delivered more than 8,800 per cent returns in the last five months, climbing to an all-time high of Rs 1,507.30 on June 26 compared to its relisting price of Rs 16.9 on January 27, 2020 on the BSE.In contrast, the benchmark S&P BSE Sensex has fallen 14.45 per cent during the same period.

After completing the resolution process under the bankruptcy law, Ruchi Soya Industries' shares resumed trading on January 27, 2020, when it was re-listed on the stock exchanges after consolidation of equity shares of the company. On January 27, Ruchi Soya shares were valued at Rs 16.9 per share, but in just 5 months, they rose to hit a record high of Rs 1,507.30 per share today.

Turnaround after debt restructuring and low free float are the main reasons for such a sharp rally in the stock.

However, the stock is not available for intra day trading.

Actually, investors are unable to buy Ruchi soya shares, the thing is that this counter is an illiquid counter means the liquidity has been wiped out in this script. It means trade-to-trade shares cannot be traded intraday.

There has to be a seller in order to execute the order successfully and hence this script is not available for intraday trading.

This script is available only in trade to trade settlement, now what is that see below point.

Trade-to-trade is a segment where shares can be traded only for a compulsory delivery basis. It means trade-to-trade shares cannot be traded intraday. Each share purchased/sold which are parts of this segment need to be taken delivery by paying the full amount.

Below is the screenshot of Ruchi soya industries shares depicting the liquidity in this script is almost dry.