WhatsApp ‘multibagger buy’ tips, lakhs of buyers, then stock crash: ED raids reveal links across 6 cities

The Enforcement Directorate (ED) raided 29 locations across six Indian cities on Friday, following complaints that over 100,000 investors lost money by buying stocks promoted on WhatsApp. The raids, conducted under the Prevention of Money Laundering Act, uncovered suspicious activity surrounding two companies, R M Drip and Sprinklers Systems Ltd, and R&B Denims Ltd. The investigation revealed that between April 2023 and March 2024, the companies issued over 35 million shares to a select group of individuals and entities.

A significant portion of the money paid for these shares originated from a small circle of connected persons, firms, and lenders. The share prices began to rise in late December 2025, with WhatsApp groups such as "Multibagger Stocks" sending daily buy recommendations to unsuspecting retail investors. The number of buyers soared from around 3,400 to over 100,000, leading to a 70% drop in share prices within days after the groups were deleted on February 25, leaving investors with substantial losses.

During the search, authorities seized documents, digital devices, and property records related to the alleged fraud. Further inquiries are ongoing.