Emkay slide continues as NSE says no to annulment

| Updated on: Oct 09, 2012

The NSE has refused to annul last week’s ‘freak’ trades done by Emkay Global Financial, as sought by the brokerage firm. As this was widely expected by traders, the stock plummeted the maximum possible limit of 10 per cent for the third successive day. On Tuesday, it closed at Rs 25.20 on the NSE, and has fallen 30 per cent since Friday, when the NSE ‘freak-crash’ saw orders worth Rs 650 crore being erroneously placed by a dealer of the broking firm.

Neither the NSE nor the broking firm divulged details of the amount paid to settle the obligations, but sources indicated that it was Rs 20-30 crore. “We are hopeful that this obvious and apparent error would justify the annulment of these trades, and we believe in the NSE’s professional management to see the merits for annulment, which is the practice worldwide,” Emkay had pleaded. However, exchange officials said an annulment would not be possible as dealings have to be squared off at multiple levels involving arbitrageurs and F&O traders.

“This is an unfortunate thing that has happened and the company has been punished more than enough. Agreed, they have had a big hit but the company will come back,” said Sudip Bandyopadhyay, MD & CEO, Destimoney Securities.

According to sources, the dealer had erroneously punched in 35 lakh quantity of Nifty shares instead of Rs 35 lakh worth of shares. This triggered a massive collapse, with the Nifty plunging about 900 points (16 per cent). The brokerage was asked to square off its positions, which it did promptly.

Published on March 12, 2018

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