Cupid shares, which rose 550% in 1 year, hit 20% lower circuit after being placed under ASM framework: What lies ahead?

Cupid shares, which rose 550% in 1 year, hit 20% lower circuit after being placed under ASM framework: What lies ahead?

• Cupid Ltd shares drop 20% after surveillance framework placement.
• NSE to impose 100% margin requirement on Cupid shares from January 6, 2026
• Analysts advise caution; key support at Rs 370, resistance at Rs 445

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Shares of Cupid Ltd hit 20% lower circuit on January 2, thus snapping their 13-day gaining streak, after they were placed under Long-term Additional Surveillance Measure Stage 1 framework.

The framework involves 100% margin requirements on T+3 day to curb volatility in certain stocks.

The margin requirement limits speculative trading and reduces risk exposure in potentially unstable or manipulated stocks. It acts as a buffer against uncontrolled price moves.

"Applicable rate of margin shall be 100% w.e.f. January 06, 2026 on all open positions as on January 05, 2026 and new positions created from January 06, 2026 onwards," said NSE in a circular on January 1.

Cupid manufactures and supplies male and female condoms, water-based lubricant jelly and IVD kits. The company has a current capacity of over 480 million pieces for male condoms, 52 million pieces of the female condoms and 210 million sachets of lubricant jelly per annum.'

At 3:10 pm on January 2, Cupid Ltd shares were trading 20% lower at Rs 420 apiece. The stock rose a whopping 550% in last one year amid strong earnings, global expansion, and reduced promoter pledge.

The stock saw heavy volume trading on January 2 with 22 million shares changing hands, which is 6 times the previous day's volume.

Over 29 lakh shares in Cupid traded across 18 block deals on NSE at 0.02% premium to 20% discount to previous close, showed LSEG data.

In an exchange filing released on December 23, Cupid announced that the pledged shareholding in the company today stands at 20 percent, after being reduced from 36.13 percent as on September 30.

The firm said that this "meaningful reduction" highlights its improving financial strength and the promoters’ strong confidence in its long-term growth trajectory. The lower level of pledged shares is expected to further enhance investor confidence and reflects the company’s disciplined financial management, it had said.

"It may also be noted that the shortlisting of securities under ASM is purely on account of market surveillance, and it should not be construed as an adverse action against the concerned company / entity," said NSE about putting the stock under ASM framework.

What lies ahead?

Analysts said the stock was ripe for profit-booking after the tearaway rally in the last one year.

"The extreme volatility of Cupid, with an intra-day drop of nearly 20% after a sustained upside move, sharply illustrates the volatile nature of market sentiments in high momentum Small Caps. The recent upside move was based on keen interest in the expansion plans as well as the acceleration in financial results, but corrections are expected in profit-booking. It would be important to note the levels of support in the stock," said Siddharth Maurya, Founder & Managing Director, Vibhavangal Anukulakara Pvt Ltd.

Jigar S. Patel, Senior Manager of Equity Technical Research at Anand Rathi Share and Stock Brokers said the short-term support for the stock lies at Rs 370.

"Cupid has witnessed a sharp correction, declining nearly 19% from its recent peak, indicating strong profit-booking pressure. The stock is currently trading below its 20-day EMA, which reflects short-term weakness in price structure. Additionally, the 50-day DEMA is placed near the Rs 370 level, making this zone a crucial support to monitor. Notably, increased selling volumes from the top further confirm distribution and a cautious near-term outlook. Given this setup, it is advisable to avoid fresh positions for now and allow the stock to stabilize. A healthy consolidation between the Rs 370–Rs 400 range would be needed before considering any bullish stance. On the upside, Rs 445 remains a strong resistance, while a breakdown below Rs 370 may invite further downside," Patel said.

"Cupid Ltd has been among the standout performers in the small-cap universe through 2025, with the stock rallying several hundred percent from its 52-week low earlier in the year to hit multiple record highs. Recent sessions saw the share surge to fresh peaks near ₹520, driven by strategic developments such as board approval for a new manufacturing facility in Saudi Arabia and a significant reduction in promoter share pledging, both of which improved structural visibility around expansion and balance-sheet risk. These moves were interpreted as supportive for the company’s longer-term growth ambitions and contributed to sustained upward price momentum.

"However, the run has also attracted profit-booking at elevated levels. Shares plunged sharply in one session, ending a long winning streak and underscoring how quickly sentiment can shift after an extended rally. Given the steep rise year-to-date and the stock’s volatility, upcoming catalysts such as quarterly performance, execution on the Saudi expansion and broader FMCG traction are likely to influence near-term price action. While the long-term expansion narrative remains intact, intermittent swings may persist around key developments and trading volumes," said Kalp Jain, Research Analyst, INVasset PMS.