The Securities and Exchange Board of India (Sebi) has asked stockbrokers to update their system to accept trade orders during the initial few minutes of the closing auction session (CAS), two people aware of the development told Mint.
"Starting September, we will begin accepting aftermarket orders between 3:15 and 3:20 pm. The move is expected to improve price discovery and liquidity in CAS," said Dhiraj Relli, managing director and chief executive officer at HDFC Securities.
The initial 5 minutes of the 20-minute-long CAS are dedicated to the calculation of the reference price and the transition to the auction system. CAS begins at 3:15pm and ends at 3:35pm.
The acceptance of after-market orders will help discover prices more accurately as liquidity improves.
Mint reported on 17 August that most domestic traders and retail investors had stepped aside from the CAS window, making it the leanest trading period of the day. Low liquidity in the auction session has led to unusual price swings and concerns around market manipulation.
Sebi has ruled out abandoning the framework. Chairman Tuhin Kanta Pandey on Monday said Sebi will not simply shut the closing auction down due to market pushback.
The framework was first introduced by Sebi in a circular in January 2026 and began operating on 3 August.
Under CAS, buy and sell orders are pooled during a dedicated end-of-day window and matched at an equilibrium price that allows the maximum volume of shares to trade. The mechanism is aimed at improving price discovery and bringing India's market closer to practices followed in other major markets.
For example, if buyers are willing to buy 100,000 shares at ₹100 and sellers are willing to sell 100,000 shares at the same price, then ₹100 becomes the equilibrium, or closing, price. No trades happen during the auction itself. Instead, all eligible trades are executed at once at the final price.
The session currently covers 208 derivative-traded stocks and replaced the longstanding volume-weighted average price (VWAP) system for determining closing prices.
An emailed query to Sebi did not elicit an immediate response.
Apoorva is a Mumbai-based journalist at Mint who covers the Securities and Exchange Board of India (SEBI), tracking the pulse of India’s capital markets, regulatory developments and the people who operate within them. She holds a postgraduate diploma in business and financial journalism from the Asian College of Journalism, where she developed a strong foundation in markets, companies, and economic policy. She began her journalism journey with an internship at Bloomberg, where she worked across beats such as real estate, infrastructure, capital markets, and deals, which helped her understanding of business and finance.<br><br>She is guided by the belief that everything in this world can be explained in simple and fewer words, and that idea shapes how she approaches her writing. She aims to cut through complexity and present nuanced regulatory and financial developments in a way that is both accessible and meaningful to readers.<br><br>When she is not tracking market chatter, Apoorva can usually be found deep into a fiction novel or out on a long run. She is also a trained classical dancer in Bharatanatyam, Mohiniyattam, and Kathakali.
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