Member FAQs on “Special Pre-Open Session” in Capital Market Segment
The special pre-open session is applicable to the below type of securities:
- IPOs securities - first day of trading. This also includes SME IPOs
- Re-listed Securities – first day of recommencement of trading. (as defined under para 1(C) of SEBI circular no. SEBI/Cir/ISD/1/2010 dated September 2, 2010)
- Stocks having derivatives contracts on the Ex-date of trading after undergoing corporate restructuring*
*Corporate Restructuring: Merger, demerger. Amalgamation, capital reduction/consolidation, scheme of arrangement, in terms of the Companies Act and/or as sanctioned by the Courts, in cases of rehabilitation packages approved by the Board of Industrial and Financial Reconstruction under Sick Industrial Companies Act and in cases of Corporate Debt Restructuring (CDR) packages by the CDR Cell of RBI.
The below are the timings for special pre-open session:
|
Pre-open2 session |
Time |
Remark |
|---|---|---|
|
Order Entry Period |
9:00 am - 9:45 am (*)
|
|
|
Order Matching & trade Confirmation Period |
9:45 am(*) – 9:55 am |
|
|
Buffer Period |
9:55 am – 10:00 am |
|
- Only Limit orders are accepted
- Order matching period will start immediately after completion of order collection period.
- Order will be matched at a single (equilibrium) price which will be open price.
- Eligible buy limit orders will be matched with eligible sell limit orders
- During order matching period order modification, order cancellation, trade modification and trade cancellation will not be allowed. The trade details will be disseminated to respective members immediately after matching of trades.
- The opening price shall be determined based on the principle of demand and supply mechanism.
- The equilibrium price will be the price at which the maximum volume is executable.
- The equilibrium price determined in call auction of pre-open 2 session is considered as open price for the day.
- In case more than one price meets the said criteria, the equilibrium price will be the price at which there is minimum order imbalance quantity (unmatched order quantity). The absolute value of the minimum order imbalance quantity will be taken into consideration.
- In case more than one price has same minimum order imbalance quantity, the equilibrium price will be the price closest to the base price. In case the base price is the mid-value of pair of prices which are closest to it, then the base price itself will be taken as the equilibrium price.
In case of IPO and SME IPO securities:
- All unmatched limit orders within applicable price range in the pre-open 2 session will be moved in the normal market session at their limit price on the basis of the price-time priority.
- This transfer will be done irrespective of equilibrium price discovered or not.
- In case of Re-listed Securities:
- In case of equilibrium price is determined, all unmatched orders within applicable price range will be moved to the normal market at their limit price on the basis of the price time priority.
For IPO security:
- The security will move to normal market at the base price (issue price) of the security
For Relisted security:
- If the equilibrium price is not determined, all the orders shall cancelled by the system.
- Security will not be available for trading in normal market if equilibrium price is not determined in any of the Exchange
- The pre-open 2 session for the said security will be conducted on subsequent trading day.
For stocks having derivatives contracts prior to undergoing corporate restructuring:
- In case equilibrium price is not discovered, all the outstanding orders shall be cancelled and the stock shall continue to trade in special pre-open session on the first day until the price is determined.
- No Price bands are applicable in the special Pre-open session.
- However in order to prevent members from entering orders at non-genuine prices in such securities based on Pre-trade risk control guidelines, the Exchange sets the dummy circuit filter i.e. operating range
- The initial dynamic price bands for IPO securities shall be set uniformly in co-ordination with other Exchanges in the range of -50% to 100% of base price.
- The initial dynamic price bands for Re-listed securities shall be set uniformly in co-ordination with other Exchanges in the range of -85% to 50% of base price.
- Yes, it shall be flexed in consultation with other Exchanges
- The Exchanges shall flex the operating range / dummy price bands in multiples of 10%
- Base price is visible in market inquiry screen (F11) on TWS in the field name “Close”.
- Applicable operating range shall be made available in security.gz file downloaded to market participants based on the set price band.
- Applicable operating range for the said security shall be displayed on TWS screen (shift + F8) in the field name “DPR”.
- Following message shall be broadcasted on trading system post any flexing/relaxing of operating range.
“Attn: Members: Please note that the <Lower / Upper> range for <Security> <Series> is being relaxed from <Original %> to <New %> in call auction special pre-open session”
- Revised operating range for the said security shall be displayed on TWS screen (shift + F8) in the field name “DPR”.
- It shall result in price freeze which shall be subsequently cancelled by Exchange.
- An illustration is provided below for better clarity :
|
Time |
Base Price (Rs) |
Operating Range (Rs) |
Order Entered at price ( Rs) |
Result |
|---|---|---|---|---|
|
09:00 am |
100 |
90 - 110 |
95 |
Accepted |
|
105 |
Accepted |
|||
|
85 |
Will result in price freeze |
|||
|
115 |
Will result in price freeze |
|||
|
09:10 am |
100 |
75 - 110 |
80 |
Accepted |
|
110 |
Accepted |
|||
|
45 |
Will result in price freeze |
|||
|
120 |
Will result in price freeze |
|
Sr. no. |
For |
Base Price |
|
|---|---|---|---|
|
1 |
IPOs ( including SME) |
Issue Price |
|
|
2
|
Re-listed Securities |
|
If revocation within 1 year, then base price shall be latest close price on NSE. Or latest Close price of security on other Exchange if not traded on NSE |
|
If revocation after 1 year, then base price shall be book value as received from statutory auditor of the company which is not older than 6 months or face value whichever is lower, subject to minimum INR 1/- per share Or latest Close price of security on other Exchange if not traded on NSE. |
|||
|
Last available price of the security on the respective Exchange |
||
|
3 |
Stocks having derivatives contracts on the Ex-date of trading after undergoing corporate restructuring |
Closing Price of the Last cum date of the scrip |
|
Terminologies Used:
SME - Small and Medium Scale Enterprises
IPO - Initial Public Offering
MoU - Memorandum of Understanding
TWS - Trader Work Station
NSE - National Stock Exchange
SEBI - Securities and Exchange Board of India
Download FAQs on Special Pre-Open Session(.pdf)
Disclaimer:
“This document/FAQ summarizes the queries relating to Special Pre-open session held in capital market segment functionality in a concise manner for the Member’s ease of understanding. The information and/ or content (collectively ‘Information’) provided herein is general information only and NSE has issued detailed circulars to that effect from time to time. as referred herein. While reasonable care has been exercised to ensure that the Information is adequate and reliable, no representation is made by NSE as to its accuracy or completeness and NSE, its affiliates and subsidiaries accept no liability of whatsoever nature for any direct or consequential loss, including without limitation any loss of profits, arising from reliance on this Information. The readers are expected to undertake their own diligence and are advised not to solely rely on this document. Any such reliance shall be at the reader’s own risk. Nothing stated herein shall bind NSE, in any manner whatsoever.”
Updated on: 02/01/2023
