Philippines’ Cebu Air Stock Loses Over $415 Million As After Trading Error by Local Broker
Philippines’ largest low-cost carrier, Cebu Air, saw a record drop in shares value and lost up to $415 million following a broker’s mistake, Bloomberg reports Wednesday, July 9.
The company’s stock fell 38%, which led to 21.3 billion pesos loss ($415 million) in market value. As of press time, the volume of shares trading was below the three-month average.
According to Bloomberg, the erroneous order happened at the end of the day, which means the deal cannot be canceled. An official from Quality Investment & Securities Corp., the company responsible for the trade, admitted it was an error.
Lance Gokongwei, Cebu Air’s CEO, also linked the drop to a fat-finger trade. He expected the price to recover on July 10.
Cebu Air was founded in 1988 and is currently operating as Cebu Pacific. It operates 37 domestic destinations and 27 international destinations in 15 countries across the Asia Pacific region.
In June, Cebu Air signed a $6.8 billion deal with Airbus to renew its air fleet. According to analyst estimates provided by Bloomberg, the airline’s profit will likely double this year.