India's markets regulator will start an optional same-day settlement for 25 stocks with a limited number of brokers on March 28, according to a circular on its website published on Thursday.
Referring to the launch as a beta version, the Securities and Exchange Board of India (SEBI) said the optional T+0 will work alongside the existing T+1 settlement.
In T+1, trades are settled within 24 hours of execution.
However, T+0 settlement will be only for trades executed between 09:15 a.m. to 1:30 p.m. IST, the circular said.
Exchanges would disclose the list of the 25 stocks eligible for T+0 settlement on their websites, SEBI said, without saying by when these stocks will be disclosed.
Exchanges shall also provide a fortnightly report on the progress of activities in the beta version of the settlement cycle till further direction, it added.
Brokers adhering to exchanges' processes and risk management norms will be eligible for T+0, and bourses will publish the list of participating brokers.
To avoid market distortions due to price discrepancies for shares trading in both settlement cycles, trading in T+0 will be subject to a price band of 100 basis points above or below prices in T+1.
"This band will be re-calibrated after every 50 basis points movement in the underlying T+1 market," SEBI said.
Prices in T+0 will not be considered for index calculation or computing settlement price of shares.
