Wednesday, November 19, turned out to be a turbulent day for stock market traders, especially those riding the recent rally in Groww’s parent company, Billionaires Garage Ventures Limited. After six straight sessions of strong gains, the stock suddenly reversed direction and crashed 10 percent, hitting the lower circuit.

Stock locked in lower circuit
Right from the opening bell, Groww shares came under intense selling pressure. The stock tumbled 10 percent to ₹169.89, triggering a lower circuit. Once a stock hits this limit, it cannot fall further for the rest of the day. Only sellers remain on the screen, and with no buyers, investors holding the stock are unable to exit their positions.

The exchange also lowered the circuit limit for the stock from 20 percent to 10 percent to control volatility. This cap now restricts the stock from moving more than 10 percent—up or down—in a single trading session.

Why are 30 lakh shares stuck?
According to a Moneycontrol report, nearly 30 lakh shares of Groww landed in the NSE’s auction window. The reason appears to be linked to short selling. Many traders sold the stock without owning it, expecting a price drop. However, when it was time to deliver the shares, they were unable to acquire them. In such cases, the exchange conducts an auction to settle these failed trades, which adds to the panic in the market.

Two key dates investors must watch
November 21: The company will declare its July–September quarterly results—its first earnings announcement after listing. These numbers will give investors a clearer view of the company’s performance.

December 10: This is the more crucial date. The one-month lock-in period for certain shareholders ends, releasing around 14.92 crore shares—nearly 2 percent of the company's total equity—into the market. If early investors choose to book profits, the stock could face significant downward pressure.

IPO investors still sitting on profits
Despite today’s steep fall, investors who were allotted shares in the IPO are still in the green. The IPO was priced at ₹100, and even after hitting the lower circuit at ₹169.89, the stock is up nearly 70 percent from its issue price.