Indices after 7 straight days of gains are again down for the second consecutive day and amid it one stock that has taken a sharp plunge of almost 35 percent in 2 consecutive days is the monopoly business stock from the Indian Railways.
In trade on October 20, 2021, the stock after steep fall yesterday, has again hit a lower 15 percent circuit and traded at Rs. 4636.65 per share.
Notably, in the previous session, the stock hit a high of Rs. 6396.3 per share and it crashed substantially and entered a bear market.
Why the steep fall in the shares of IRCTC?
The view by the speculators on the stock is the main reason and as per the ET report the market-wide position limit on the October futures of IRCTC most likely crossed the 95 per cent threshold. NSE is mandated to put any stock where the MWPL crosses 95 per cent under a temporary F&O ban till the positions in the contract come below the 80 per cent mark.
A ban is perhaps a bad thing for speculators taking long calls as they will probably end up booking a lot of profits as traders will only be allowed to liquidate existing positions and not take new positions. "Since most positions in IRCTC were bullish, this would mean that if the stock enters an F&O ban, it would see liquidation of those positions that will cause the stock price to fall", said the ET report.