The Securities and Exchange Board of India (SEBI) has issued circular for implementation revised block deal framework for stock exchanges. The aim of this new framework is to make the execution of large trades more transparent and efficient.
The block deal mechanism enables large, pre-arranged transactions between parties to be executed on the exchange during specific trading windows, under stringent regulations designed to prevent price manipulation.
As per existing norms the price range is ±1 percent and the minimum order size is Rs 10 crore.
The new framework has raised the price range to ±3 percent of the reference price and the minimum order size has also been increased to Rs 25 crore.
These higher thresholds are expected to bring liquidity to the market, as the orders below Rs 25 crore will take place in the normal market.
Block deals take place during two dedicated trading windows — a morning session from 8:45 AM to 9:00 AM and an afternoon session from 2:05 PM to 2:20 PM.
According to SEBI’s circular, the morning window will use the previous day’s closing price as the reference rate, while the afternoon window will rely on the volume-weighted average price (VWAP) of trades executed between 1:45 PM and 2:00 PM.
Stock exchanges will compute and publish the relevant VWAP between 2:00 PM and 2:05 PM, just before the afternoon session begins. The new SEBI framework will come into effect on 07 December 2025.
The SEBI circular further stated that the above provisions shall also be applicable for the block deal window under the optional T+0 settlement cycle.