Bloomer costs investors Rs 12 cr
Call it the biggest blunder by BSE or a small typing error, a clutch of investors lost over Rs 12.69 cr within seconds.business Updated: Jan 05, 2006 18:53 IST
Call it the biggest blunder by the country's premier bourse BSE or a small typing error, a clutch of investors on Thursday lost over Rs 12.69 crore within seconds as the newly listed Tulip IT Services shares changed hands at a meagre 25 paise as against its market price of Rs 185.
As per BSE data, about 4.04 lakh shares of Tulip IT Services were sold at 25 paise during the peak trading hours at 2.24 pm.
A few seconds later, about 5.95 lakh shares of the newly listed IT company were sold at a price of Rs 100 a share.
For quite a few seconds, the share price dwindled between 160 and 185 before finally stabilising at its intrinsic value Rs 185 at 2.25 pm.
The total number of Tulip shares traded in the bourse was about 11.78 lakh at a weighted average price of Rs 77.25.
Tulip opened at Rs 180 at BSE, sunk to 25 paise in the afternoon and finally closed at 182.55.
So, some of the buyers of Tulip shares had a windfall gain while some sellers lost a fortune.
Since, the shares of debutant company are not subject to any price filter, the errors and omissions went unchecked.
But it cost the sellers of the share a whopping Rs 12.69 crore within seconds.
Brokers say the transactions cannot be reversed automatically as the trading takes place through the electronic mode.
If and only if, both buyers and sellers agree to reverse the transaction can the error be undone.
Brokers also say the maximum compensation that be offered to aggrieved investors is Rs 5 crore, which is a bare fraction of the losses suffered.
First Published: Jan 05, 2006 18:47 IST