Pump & Dump: After bagging an order of USD 1.29 billion order from Beulah International, Promoter of this EV manufacturing company sold 67,12,785 shares!
The stock gave multibagger returns of 100 per cent from its 52-week low of Rs 33.21 per share and a whopping 700 per cent in 5 years.
Before starting let’s understand - What is pump and dump in the stock market?
In a pump-and-dump scheme, fraudsters spread false information to hype up a stock's price, attracting unsuspecting investors who buy in at the inflated price. Then, the fraudsters sell their own shares at a higher price before the bubble bursts and the stock price crashes, leaving the new investors with big losses.
The stock we will be discussing is Wardwizard Innovations & Mobility Limited (WIML).
Order (Received on June 07, 2024) - Indian electric vehicle manufacturer Wardwizard Innovations & Mobility Limited (WIML), known for their "Joy e-bike" and "Joy e-rik" brands, has secured a massive USD 1.29 billion order from Beulah International Development Corporation, a prominent Philippines EPC firm. This partnership goes beyond just a business deal. Through a Memorandum of Understanding (MoU), WIML will supply electric two-wheelers, and three-wheelers, and even develop new four-wheeler electric vehicles specifically for the Philippines' commercial market. This collaboration aims to revolutionize the Philippines' public transportation system with clean electric vehicles, aligning perfectly with the Philippine government's push to modernize their public utility vehicles. By replacing ageing gasoline and diesel vehicles, WIML and Beulah International hope to create a more sustainable and efficient transportation system, while also generating new jobs and boosting the Philippines' local economy.
Also Read: Vijay Kedia’s portfolio multibagger penny stock under Rs 70 with Rs 18,663 crore order book rockets 6 per cent today; do you own it?
Here comes the Pump & Dump in WIML
The stock price saw a significant surge, rising over 40% in just 2 days. On June 7th, 2024, the closing price was Rs 52.20 per share. By June 11th, 2024, the price had climbed to Rs 74.26 per share. This jump likely stemmed from two consecutive days of 20 per cent upper circuits, indicating strong buying pressure. However, the company promoter took advantage of this by selling their own shares. With a large order of USD 1.29 billion, likely the biggest the company had ever received, the promoter saw an opportunity to profit. They offloaded shares in the open market, selling 25,00,000 shares on June 10, 2024 and another 42,12,785 shares on June 11, 2024.
About Wardwizard Innovations & Mobility Limited
Wardwizard Innovations & Mobility Limited is one of India’s leading auto manufacturing companies in the Electric Vehicle (EV) segment under the brand name Joy e-bike. Being the first listed entity on BSE in Electric Vehicle manufacturing, it is mainly focused on the growth potential in the Indian EV segment to have a positive impact in the future. Given the current state of the environment, where fuel-powered vehicles account for the vast bulk of carbon emissions, the company is promoting improvement by offering cleaner, greener options that produce no emissions. With more than 10 models in its portfolio in both high and low-speed categories, the Company has established a strong presence in more than 400+ major cities across India and aspires to boost this number throughout the country.
The company falls under the BSE Small-Cap Index with a market cap of over Rs 1,700 crore. On Wednesday, shares of Wardwizard Innovations & Mobility Ltd plunged 7.15 per cent to Rs 68.29 per share from its previous closing of Rs 73.55 with an intraday high of Rs 71.50 and an intraday low of Rs 64. The shares of the company saw a spurt in volume by more than 2.33 times on BSE. The stock’s 52-week high of Rs 86.50 and its 52-week low is Rs 33.21. The stock gave multibagger returns of 100 per cent from its 52-week low of Rs 33.21 per share and a whopping 700 per cent in 5 years.
Looking at this few questions arise that
- Did the promoter have any prior indication that the company would land such a substantial order and wait to book profits in the stock?
- After getting such a big order of USD 1.29 billion, why would a promoter sell 67,12,785 shares in the open market?
- Is the promoter trying to manipulate the stock price & will SEBI investigate it?
Do let us know your thoughts in the comments below!
Disclaimer: The article is for informational purposes only and not investment advice.
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