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Informist, Thursday, May 21, 2026

 

MUMBAI – The Securities and Exchange Board of India Thursday proposed allowing automatic flexing of dummy price bands during the pre-open call auction session related to initial public offers and re-listing scrips. The dummy price bands should be auto-flexed by 10% if at least 5 unique investors have put orders at the upper or lower range. Currently, the dummy price bands are changed manually.

 

"In case of orders are present only on the buy side at upper range of the dummy price band or only on the sell side at the lower range of the dummy price band, the dummy price band shall be auto flexed by 10?ter validation of orders from at least 5 Permanent Account Number (PAN) based unique investors at the upper range or lower range of the dummy price band respectively and the same shall be immediately communicated to other stock exchanges for simultaneous flexing at their end," SEBI said in a consulation paper. The regulator has sought comments on the consultation paper by Jun. 11.  

 

SEBI also proposed a call auction session should be treated successful if price discovery is based on orders from at least 5 unique buyers and sellers. If the call auction fails on the first day, the IPO scrip should move to the normal market, with the issue price as the base price. If the auction fails during re-listing of a stock or corporate restructuring, then call auction sessions should continue the next day until price discovery occurs. 

 

For a scrip seeking re-listing within six months of delisting, SEBI said its latest closing price should be considered the base price. If the closing price is not available, the base price can be the lower of the company's book value, as given by two independent chartered accountants or valuation agencies. The book value should not be more than 3 months old, SEBI said.

 

In case a stock is relisted more than six months after delisting, SEBI said the base price should be determined based on the company's book value as provided by two independent chartered accountants or valuation agencies. This book value should also not be more than three months old, SEBI said.  End

 

Reported by Anshul Choudhary

Edited by Saji George Titus

 

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