On August 22, 2025, the Securities and Exchange Board of India (“SEBI”) has initiated a review of the existing Block Deal Framework to improve transparency, efficiency, and safeguard market integrity in large transactions.[1] A Working Group comprising representatives from: Stock Exchanges (BSE, NSE), Clearing Corporations (NCL, ICCL), AMFI, ANMI, and BBF was constituted to examine the current framework and suggest improvements.
Based on the recommendations of the Working Group, internal deliberations, and discussions in the Secondary Market Advisory Committee (SMAC), SEBI has now released a draft circular proposing modifications to the block deal framework.
Key Proposed Amendments:
1. Definition of Block Deal: A block deal is defined as the execution of large trades via a single transaction without disadvantaging either party, facilitated through a dedicated trading window.
2. Block Deal Windows:
- Morning Block Deal Window:
| Time | 08:45 AM to 09:00 AM |
| Reference Price | Previous day’s closing price |
- Afternoon Block Deal Window:
| Time | 02:05 PM to 02:20 PM |
| Reference Price | VWAP of trades executed between 01:30 PM and 02:00 PM |
| VWAP Calculation Period | 02:00 PM – 02:05 PM |
3. Price Range for Orders:
- F&O Stocks: ±1% of the reference price
- Non-F&O Stocks: ±3% of the reference price (subject to surveillance measures)
4. Order Size and Settlement: The minimum order size shall be INR 25 Crores (Indian Rupees Twenty Five Crores Only) and the trades must result in delivery and cannot be squared off or reversed.
5. Disclosures: Stock exchanges shall publish block deal data after market hours, including the Name of the scrip, Client name, Quantity traded and Price.
6. Applicability of Risk and Surveillance Measures: All trading, settlement, surveillance, and risk containment mechanisms applicable to regular trades shall also apply to block deals.
7. Call for Public Comments: Stakeholders including market participants, legal advisors, and institutional investors are encouraged to review the proposed changes and submit comments to ensure the final framework is inclusive and effective. SEBI has invited public comments on the draft circular latest by September 15, 2025. The submission may be made online through the SEBI public comments portal.
[1] https://www.sebi.gov.in/reports-and-statistics/reports/aug-2025/consultation-paper-on-review-of-block-deal-framework_96252.html