Sebi committee evaluating extending trading hours: Bhave

Market regulator Securities and Exchange Board of India (Sebi) today said it is looking at extending trading hours at the bourses but any early decision on it is unlikely.

"This issue will take a while," Sebi Chairman C B Bhave told PTI while giving details of how the issue is being discussed at a high level committee of the regulator.

There has been demand for extending the trading hours beyond 0955 hours to 1535 hours as part of efforts to align business with the markets in Asian region to guard against the lagged effect on Indian scrips.

"Actually this issue (extending market hours) got discussed in our secondary market advisory committee but the participants pointed out that there are lot of practical nitty-gritty that needs to be sorted out before the decision is taken," he said.

Citing some of the issues, he said, "If you are having trading between 5 in the evening till 11 at night then how do people do the banking transactions during that time. If somebody has to bring in additional margin where is the mechanism to bring that."

The second, Bhave said, "If you close the trading window at 11 o'clock at night then you would be doing T+2 (Trading plus 2 trading session) or would be declaring this session as part of the next day session.

"So lot of issues, which have not really to do with the policy but administrative issue, need to be sorted out. So they decided to have a committee of the exchanges which will go into this and then come back to the advisory committee," Bhave said.

Asked if the regulator had any intention of changing terms of trade including the system of circuit breaker to curb the volatility, he said, "In fact, there is no proposal to change the system. We are handling the problem in the reverse direction.

"People say why did you close the market for the whole day. I think it was May 18 after the election result because everybody knew results are there and the market is going up you could have given two hour halt or something like that and allowed the price to go wherever it wanted," he said.

Stating that at 12 o'clock on May 18, when the trading was halted for the day, the order book revealed only buy order but hardly any sell order, Bhave said that the circuit breaker helped halt crazy driving up of the prices and the market came to balance the next day.

Elaborating the event on May 18, when trading was suspended for the day after the second circuit breaker was applied following about 2,100 points surge in the Sensex, he said at one instance the market closed in 10 seconds and next in the 15 seconds.

People did not get opportunity to cover the position, so the next day they were able to cover as the supply came in, he said and answered in a negative if there was any hanky-panky that caught his attention.