One of India’s biggest recent trading mishaps unfolded in Mumbai on Thursday when Spark Institutional Equities Pvt., a unit of Avendus Capital Pvt., mistakenly executed duplicate block orders to sell shares of Clean Science & Technology Ltd., according to people familiar with the matter, Bloomberg reported.
The brokerage was instructed to sell as much as 24% of Clean Science on behalf of its founding Boob family in a $300 million deal aimed at trimming the clan’s stake while retaining a majority holding. But after the initial order failed to appear in the system, traders at Spark attempted to resubmit it. Minutes after the market opened, they discovered that both orders had gone through, leaving more than half of the company’s shares in play.
In total, 59.8 million shares — representing 56% of Clean Science’s outstanding stock — changed hands for 65.4 billion rupees ($749 million) in the first four minutes of trading, according to data compiled by Bloomberg.
The sudden surge in supply sent the stock on a rollercoaster ride: shares initially slumped 9.3% to 1,070.50 rupees, then rebounded as much as 17% to 1,256.80 rupees, before closing the session down 2.7%.
Avendus quickly moved to repurchase a significant portion of the shares, buying back 32.2 million, or a 30% stake, at roughly the same price they had been sold. According to Bloomberg’s sources, the founding family was told there would be no financial losses from the episode.
Clean Science and Avendus both issued statements acknowledging the error but stopped short of explaining how it occurred. Representatives of both companies did not respond immediately to emailed queries.
The mishap has been compared to other high-profile trading blunders in India, including the 2022 collapse of an index option by 99.99% and a flash crash in the Nifty 50 more than a decade ago. It comes just days after India’s sovereign bond yields fell by 10 basis points in what appeared to be a fat-finger trade, and weeks after an unexplained 10% pre-market spike in SBI Cards & Payment Services Ltd. shares.
Trading errors are not unique to India. In the US, Citigroup Inc. narrowly avoided a $6 billion overpayment last year after an employee mistakenly copied and pasted an account number into the wrong field.
“Brokers have to be extra careful,” said Deena Mehta, managing director of Asit C. Mehta Investment Intermediates Ltd. and former president of BSE Ltd. “If shares are acquired by a large number of buyers, it is challenging for exchanges to cancel the trades.”
For Clean Science, the incident marks the first time in its two-decade history that the Boob family’s majority control was briefly shaken — all because of what Bloomberg described as a ghost order gone wrong.
