Elcid Investments Becomes India's Most Expensive Stock, Rising from ₹3.53 to ₹2.73 Lakh

Elcid Investments has made headlines by becoming India’s most expensive stock, rising 21% in three trading sessions. This smallcap stock created history on Dalal Street by jumping from just ₹3.53 to an astonishing ₹2,36,250 in a single day; a massive increase of nearly 67,000 times. The stock has a market value of ₹5,470 crore.

On October 29, Elcid surpassed MRF Ltd., becoming the most expensive stock, after the Bombay Stock Exchange (BSE) held an auction to find the fair value of holding companies. As Elcid’s shares skyrocketed, MRF was trading 1% lower at ₹1.22 lakh each, showing a dramatic shift in the market on Monday. Elcid Investments' shares were trading at a 5% upper circuit at an astounding ₹2.73 lakh on November 4.

How did Elcid Investments go from ₹3.53 to ₹2,36,250?

The surge in Elcid's stock price wasn't due to a single event; it was mainly fueled by a special auction organized by the Bombay Stock Exchange (BSE) to assess the true value of investment holding companies. The stock has historically traded between and₹15. However, Elcid Investments has a remarkable book value, which is reported to be ₹5.84 lakh according to Screener. 

To address the disparity between the current market value and the book value of holding companies, exchanges initiated a price discovery process for selected investment holding companies using a special call auction mechanism on October 29.

In June 2024, SEBI issued a circular suggesting a new method to enhance price discovery for Investment Companies (ICs) and Investment Holding Companies (IHCs). SEBI observed that many of these companies were trading well below their book value. To boost liquidity, ensure fair price discovery, and increase investor interest in these stocks, SEBI implemented a framework for a “special call auction without price bands” for these companies.

About Elcid Investments

Elcid Investments is a non-banking financial company (NBFC) registered with the Reserve Bank of India. It focuses on holding investments and managing a portfolio worth over ₹12,450 crore. One of its key assets is a 2.83% stake in Asian Paints, valued at about ₹8,500 crore. Elcid doesn’t run any active businesses but earns money through its investments in various companies.

To Summarize

Elcid Investments has reached a major milestone by becoming the most expensive stock in India, with its price soaring due to a new auction process for price discovery. If an investor had owned 10,000 shares of the company, their initial investment of just ₹35,300 would have soared to an incredible ₹250 crore. This remarkable increase in stock value highlights the potential of undervalued investments and the effect of changes in market regulations. While investing in penny stocks can be risky, Elcid’s story shows how significant returns can be achieved in the stock market.