This sharp decline was triggered by the launch of DeepSeek, a new, low-cost AI model by a Chinese startup, sparking concerns among investors about increased competition.
While primarily known for its real estate developments, Anant Raj has been expanding its presence in the burgeoning AI market through its subsidiary, Anant Raj Cloud. The company in July 2024 announced a high-profile collaboration with Google to develop advanced AI solutions, further solidifying its commitment to the sector.
DeepSeek, touted as more efficient and significantly cheaper than its competitors, has quickly gained traction, even surpassing ChatGPT in downloads. This has put pressure on established players, including firms like Google, and their collaborators.
Analysts believe that such innovations could disrupt market dynamics, potentially eroding the profitability of companies reliant on high-cost AI solutions.
Investors reacted swiftly to the perceived threat, selling off shares of Anant Raj and other AI-adjacent companies. The stock’s plunge highlights the heightened sensitivity in the sector, where innovation and pricing strategies can significantly sway market sentiment.
Anant Raj is a diversified real estate company focused on developing IT parks, hospitality projects, data centers, office complexes, shopping malls, and residential projects in India. The company has a strong presence in Delhi, Haryana, Andhra Pradesh, Rajasthan, and other parts of the NCR region.
On a consolidated basis, net profit of Anant Raj surged 75.67% to Rs 105.58 crore while net sales rose 54.34% to Rs 512.85 crore in Q2 September 2024 over Q2 September 2023. The company's board will consider Q3 results on 1 February 2025.