Stock Crash: From multibagger to mid-air crash! Selling rush hits lower circuit, why should investors panic?:

News Topical, Digital Desk : The stock that made investors rich in just a few months is now causing concern. The stock, which was available at around ₹676 in August 2025, reached ₹2,800 and became a multibagger. But the picture changed as December began. Repeated lower circuits, sharp declines, and growing anxiety have left retail investors wondering what has suddenly changed about this stock.
Between August and November 2025, the stock saw a tremendous rally. From around Rs 676, it reached Rs 2,800, representing a return of more than four times in just a few months. However, this rally seemed to stall from the beginning of December, and the stock came under constant pressure. Now, the stock has slipped below Rs 1,860. Today's opening was also weak, opening at Rs 1,854.75, compared to the previous close of Rs 1,952.35. Most shockingly, despite the increased stake of foreign investors (FIIs), the stock has failed to recover. This is why retail investors are wondering why the decline hasn't stopped.

This company is A-1 Limited. What is its business? Understanding the business is crucial for investors. A-1 Limited is a company that trades and transports industrial chemicals and acids. Its model is divided into three parts: first, the supply of bulk industrial acids. This includes products like nitric acid, sulfuric acid, hydrochloric acid, acetic acid, oleum, methanol, formaldehyde, and sodium hypochlorite. These are used extensively in the pharmaceutical, fertilizer, textile, dye, glass, and metal industries. Second, liquid chemical transportation. The company delivers bulk chemicals via tanker. This segment is considered relatively stable and provides regular cash flow. Third, the combined trading and logistics model. This is why the company's margins are considered superior to many smaller players.

Why the sudden decline? This decline in A-1 Limited isn't the result of a single negative news; it's actually a combination of several factors. The primary reason is profit-booking after a sharp rally. Profit-booking is almost inevitable in a stock that has delivered nearly 440% returns in a year. Investors and traders tend to book profits at higher levels, which increases supply. Another major reason is trader activity surrounding bonuses and splits. Speculation and short-term trading often increase around such corporate actions. As soon as the trend reverses, a sharp sell-off begins. The third and biggest trigger was the continuous lower circuit. Between December 1st and 5th, the stock hit lower circuits of 5% each for five consecutive sessions. Overall, a correction of approximately 22–23% was observed. There were several sessions when only sell orders were seen and no buyers were seen. In such a situation, fear spreads rapidly, and this is known as distress selling in market parlance. It's noteworthy that even after such a decline, the stock is still approximately 4.4 times above its 52-week low. This means that, looking at the long-term chart, the stock is still trading at a significant level.

Why hasn't the stock recovered despite FII buying? Data shows that FIIs have made significant purchases in A-1 Limited. FII share in September 2024: 2.91% FII share in September 2025: 6.03%