Groww beats BSE m-cap as stock scarcity sparks frenzy

A series of short squeezes, driven by soaring demand and low trading float, has propelled digital investment platform Groww's market value past that of one of the exchanges it listed on, making it the only broker to hold this feat.

- Ram Sahgal

The stock was listed on both BSE and NSE last Wednesday. In just a week of trading, its market value catapulted from ₹0.7 trillion at listing to ₹1.166 trillion on Tuesday, around ₹12 billion above the BSE's ₹1.154 trillion. The other exchange Groww listed on, the National Stock Exchange or NSE, is not listed.

Brokers tracking the counter said short squeezes caused amid a limited supply of freely available shares have pushed Groww's market capitalization sharply up.

Despite a high public shareholding of 72.19%, only about 11% of Groww's shares are actually tradeable. That's because foreign investors (57.15%) and mutual funds (4.06%) cumulatively hold 61.21% and typically don't sell often, while promoters hold another 27.81%.

The brokers added that until lock-in of part of the anchor investor portion takes place early next month, the share supply could remain tight. Half of the anchor investor portion of 298.4 million shares will be unlocked on 10 December. The lock-in for the remaining 50% will end after 90 days from the date of allotment, which was 10 November. Anchor investors are large institutional buyers that buy company shares before it goes public.