CAS remains in place, but changes to derivatives settlement may be forthcoming, according to Sebi chief Tuhin Kanta Pandey.

The Securities and Exchange Board of India (SEBI) Chairman Tuhin Kanta Pandey has confirmed that the current Closing Auction Session (CAS) will remain in place despite discussions regarding potential changes to the derivatives settlement process following a recent decline of 1,000 points in the equity market. He emphasized that the CAS has played an important role in enhancing market stability.

Moreover, some industry stakeholders have expressed concerns regarding the CAS, suggesting it may have caused more harm than good. The criticism stems from perceptions that the CAS doesnt effectively address market volatility and could complicate trading on expiry days. Several market participants, including players in the Bombay Stock Exchange (BSE), have noted their reluctance to fully engage with the CAS, citing operational difficulties.

In response to these concerns, SEBI is evaluating the necessary adjustments to the derivatives settlement process, which may potentially align better with the goals of the CAS. The regulator remains committed to ensuring market integrity and protecting investor interests as the landscape evolves.

The SEBIs ongoing efforts are part of a broader initiative to enhance market efficiency and transparency in Indias capital markets, particularly as local and global economic conditions fluctuate.