A record-breaking rally turns a little-known Indian stock into a market talking point
The world’s best-performing stock over the past two years is no global technology giant, but a little-known Indian company whose extraordinary rise is now raising uncomfortable questions for investors and regulators alike. RRP Semiconductor Ltd, until recently obscure even within domestic markets, has delivered a staggering rally of more than 55,000 percent in just 20 months through December 17, making it the top-performing stock globally among companies valued above $1 billion.
What began as a niche story linked loosely to India’s semiconductor ambitions quickly transformed into a social-media-driven frenzy. The rally was powered by a thinly traded stock, a surge of retail participation, and speculative enthusiasm around artificial intelligence, even as the company’s fundamentals lagged far behind its soaring market value.
Weak fundamentals clash with extraordinary market enthusiasm
Despite its meteoric rise, RRP Semiconductor’s underlying business has struggled to keep pace with investor expectations. The company reported negative revenue in its latest quarterly results, alongside a net loss, and disclosed just two full-time employees in its most recent annual filing. Its connection to the semiconductor boom remains indirect, following a strategic pivot away from real estate in early 2024.
Market data shows the stock hit the upper trading limit for 149 consecutive sessions, a phenomenon rarely seen at this scale. Exchange officials and the company itself issued repeated cautions, but those warnings did little to dampen enthusiasm during the peak of the rally. Since its November high, however, cracks have begun to appear, with the stock slipping from peak levels as scrutiny intensifies.
Regulatory scrutiny grows as SEBI examines the surge
The rally has now drawn the attention of the Securities and Exchange Board of India, which has begun examining trading activity in RRP Semiconductor for potential irregularities, according to people familiar with the matter. The company’s shares, valued at around $1.7 billion, have also been restricted by the exchange to trading just once a week, a move typically reserved for stocks under heightened surveillance.
A spokesperson for BSE said all surveillance actions related to the stock were communicated through market circulars, underscoring that monitoring mechanisms had been triggered as the rally accelerated. RRP Electronics, owned by promoter Rajendra Chodankar, declined to comment on regulatory developments, citing an ongoing legal appeal.
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Limited AI exposure fuels speculative demand in India’s market
While RRP’s rise is unlikely to alter the broader global AI investment story, it highlights how speculative excess can build rapidly in markets with limited exposure to popular themes. India has very few listed semiconductor or AI hardware players, leaving retail investors eager for proxy exposure to the global chip boom.
“Semiconductors have been really hot and people are willing to buy any name given India has limited stocks to offer,” said Sonam Srivastava, founder at Wryght Research & Capital Pvt. “With global worries around AI valuations, cases like RRP show how fragile such enthusiasm can be.”
Similar cautionary signals have emerged across Asia. In China, newly listed AI-chip firm Moore Threads Technology warned investors about trading risks after a sharp rally, while South Korea’s SK Hynix saw shares retreat after regulators raised risk alerts amid a steep rise.
Corporate restructuring and promoter control shape the narrative
RRP Semiconductor’s transformation traces back to early 2024, when Chodankar took control of G D Trading and Agencies Ltd by repaying loans in exchange for equity. The board later approved issuing shares to him and others at a significant discount, lifting his ownership to nearly three-quarters of the company and reducing the original founders’ stake to a negligible level. The firm was subsequently renamed RRP Semiconductor.
Around the same time, Chodankar incorporated RRP Electronics Pvt to develop an outsourced semiconductor assembly and testing facility in Maharashtra. This parallel venture, though privately held, helped reinforce market narratives linking the listed entity to India’s chip ambitions.
At a public event in September 2024, Chodankar said, “India is going to be a superhuman, it’s established beyond doubt,” reflecting the optimism surrounding the country’s semiconductor push.
Governance concerns and financial stress deepen investor unease
As the stock surged, corporate developments raised further questions. Chodankar resigned from the board, senior executives exited and rejoined in new roles, and the company filed complaints against social-media influencers over alleged misinformation. In regulatory filings, RRP clarified that it had not begun semiconductor manufacturing, had made no applications under government incentive schemes, and had no celebrity associations.
Financial disclosures added to the unease. The company reported negative revenue after reversing sales from a large order that was later cancelled due to contractual disputes. Losses continued, offering little reassurance to investors entering at elevated prices.
A cautionary tale as AI hype meets regulatory reality
With nearly the entire share float controlled by the promoter and a small circle of associates, liquidity risks remain elevated. As regulatory scrutiny tightens and AI enthusiasm cools globally, analysts warn that the downside risk now sits squarely with late-stage investors who chased extraordinary returns.
RRP Semiconductor’s story has become a vivid reminder that while India’s AI and semiconductor ambitions are real, not every stock linked to the theme reflects that potential. For regulators, it underscores the challenge of balancing market enthusiasm with investor protection. For investors, it serves as a timely lesson that even world-beating rallies can carry equally outsized risks.
