SEBI Weighs Change To CAS Time Window; AMOs May Enter Before 3:20 PM

The five-minute gap between the end of continuous trading and the start of the Closing Auction Session (CAS) could soon change. Under the arrangement proposed by the Securities and Exchange Board of India (SEBI), investors may be able to place after-market orders during the 3:15 pm to 3:20 pm transition window.

What Could Change In The CAS Time Window?

Continuous trading in eligible stocks currently ends at 3:15 pm. The Closing Auction Session starts at 3:20 pm, leaving a five-minute transition period in between.

The existing process does not allow fresh orders during this gap. The proposed change would open that window to AMOs, with those orders then pushed into the CAS when the auction order-entry process begins.

Brokers have already been asked to make changes to their apps and websites following discussions with the regulator. The updates are expected to appear on broker platforms after 1 September, with implementation likely to follow soon after.

For investors, the proposed workflow would mean an AMO placed after 3:15 pm would not simply sit outside the closing auction. Instead, it could be routed into the auction once order entry starts.

Why Is SEBI Looking To Change The CAS Process?

The proposed change could bring more orders into the closing auction. That matters because CAS uses these orders to arrive at the day's closing price. A larger pool of orders may also improve liquidity during the auction.

The current five-minute transition period leaves fresh orders out of the auction pool. Allowing AMOs during this period could bring additional orders into CAS, particularly for stocks where auction participation remains low.

CAS was introduced on 3 August for stocks with available F&O contracts. The CAS replaced the earlier VWAP-based mechanism for determining the closing price. Under the new system, continuous trading ends at 3:15 pm before the auction process begins.

How Are Brokers Preparing For The CAS Change?

The proposed change was discussed with brokers a few days ago, with market intermediaries asked to make the required changes to their applications and websites.

The intended process is straightforward. An investor placing an AMO between 3:15 pm and 3:20 pm could have that order routed into CAS after the auction order-entry window opens, rather than having to wait for the next trading session.

The move comes as CAS participation remains a focus for SEBI. Chairman Tuhin Kanta Pandey has said participation is expected to improve as market participants become more familiar with the new system.

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