SEBI Proposes Harmonised Price Band Framework for Multi-Listed Securities

SEBI Consultation Paper, Dated 11.06.2026

SEBI has issued a consultation paper proposing the harmonisation of the base price for the pre-open call auction session and price bands applicable to securities listed on multiple stock exchanges. The proposal aims to address price disparities that may arise when a security trades on one exchange but remains untraded on another.

1. Issue Identified by SEBI

SEBI observed that in the case of certain multi-listed securities, particularly illiquid stocks, different exchanges may use different closing prices as reference points for determining the next day’s trading range.

This situation can arise when:

• A security trades on one exchange but remains untraded on another; and
• Exchange-specific closing prices continue to be used for determining base prices and price bands.

As a result, the same security may have different reference prices across exchanges.

2. Concerns Arising From Divergent Reference Prices

According to SEBI, continued reliance on exchange-specific closing prices may lead to:

• Significant price divergence across exchanges;
• Inefficient price discovery;
• Arbitrage opportunities;
• Wider pricing gaps over time; and
• Reduced trading activity on exchanges using outdated reference prices.

These issues are particularly pronounced in illiquid securities where trading occurs infrequently.

3. Proposed Harmonisation Framework

To address the issue, SEBI has proposed that where a security has not traded on a particular exchange, the reference price should be aligned with the exchange where trading has taken place.

Under the proposal:

• The base price for the pre-open call auction session, and
• The applicable price band

would be determined using the closing price of:

• The exchange where the security traded, or
• The exchange is recording the highest trading volume.

4. Objective of the Proposal

The proposed framework seeks to:

• Ensure uniformity in reference prices across stock exchanges;
• Improve price discovery;
• Reduce pricing discrepancies for the same security;
• Enhance market efficiency; and
• Minimise arbitrage opportunities arising from divergent price bands.

5. Public Consultation

SEBI has invited comments from stakeholders on the proposed framework before finalising the revised mechanism.

6. Expected Impact

If implemented, the proposal would create a more consistent trading environment for securities listed on multiple exchanges by ensuring that base prices and price bands are derived from a common and relevant market reference. This is expected to improve liquidity, strengthen price discovery and reduce distortions caused by exchange-specific pricing differences.

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