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Sebi issues new block deal window rules; minimum order size now Rs 10 cr

Now, Sebi would provide two trading windows-- morning and afternoon-- of 15 minutes each

Press Trust of India  |  New Delhi 

he stock exchanges would disseminate the information on block deals

Market regulator Securities and Exchange Board of India (Sebi) on Thursday revised the framework for 'block deals' by providing two separate trading windows of 15 minutes each and increasing the minimum order size to Rs 10 crore.

The move is aimed at ensuring confidentiality of the large trades and stable prices for such transactions. The block deal window is provided for buyers and sellers to execute trades for a large number of Such deals are usually negotiated before their execution.

Under the new rules, would provide two block deal windows — morning and afternoon — of 15 minutes’ duration each. Besides, the regulator has increased the minimum order size for execution of trades in the block deal window to Rs 10 crore. Currently, for worth Rs 5 crore through a single is allowed. The decision has been taken as received suggestions from market participants to review the block deal framework.

The final norms have been put in place after taking into consideration views of market participants and the Secondary Market Advisory Committee (SMAC). The morning window would operate from 8:45 am to 9:00 am and the reference price for execution of in this window would be the previous day's closing price of the stock.

With regard to the afternoon window, the regulator said it would operate from 2:05 pm to 2:20 pm. The pricing would be based on the volume weighted average market price (VWAP) of the trades executed in the stock in the cash segment between 1:45 pm and 2:00 pm. “Between the period 2:00 pm and 2:05 pm, stock exchanges shall calculate and disseminate necessary information regarding the VWAP applicable for the execution of in the afternoon block deal window,” said in the circular.

First Published: Fri, October 27 2017. 02:53 IST