New Delhi: Share exchange and other market infrastructure institutions on Monday exit with a road map for the implementation of the T + 1 settlement cycle (Trade Plus One Day) where the mechanism will be introduced gradually from February 25.
T + 1 means settlement related to market trade must be cleaned in one day of the actual transaction that occurs.
At present, trade in the Indian stock exchange is completed in two working days after the transaction is made (T + 2).
The settlement cycle will be implemented in stages and will only apply to the 100 bottom companies starting February 25, and from March 2022 and so on, the next 500 stocks will be available for the introduction of T + 1 completion, according to a shared statement.
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The decision has been taken by the market infrastructure agency or the exchange of shares of MII, cleaning the company and depositor.
This came after the market regulator Sebi in September allowing stock exchanges to introduce the T + 1 settlement cycle from January 1, 2022 on one of the effects available in the equity segment.
According to the statement, all shares registered, across exchanges (BSE, NSE and Msei), will be ranked in a decreasing order based on the average daily market capitalization for October 2021.
Where stocks are registered in several exchanges, market capitalization will be calculated based on prices Stocks on the Stock Exchange with the highest trading volume during the period reviewed.
Stock list and exchange where they are available for trading will be published on the website all exchanges.
Based on the ranking arrived, the lowest 100 shares will be available to the introduction of T + 1 completion, from February 25, 2022.
After that, from March 2022 and so on, on Friday (trading day) every month, 500 below the next, 500 shares from the Stock list Will be available for Introduction to T + 1.
In the event that Friday is a trade holiday, the same thing will be introduced on the next next trade day.
Each new stock registered after October 2021, will be added to the list, based on market capitalization calculated based on the average trade price of 30 days after the commencement of trade.
In this case, based on market capitalization, if the stock is under the category (in terms of market capitalization) shares have been under the settlement of T +1, the stock is also eligible for the T + 1 settlement and will be introduced to the T + 1.
Cycle settlement Last Friday (trading day) next month.
This will also apply to new stocks listed because of the initial public offering (IPO), corporate actions or other reasons and the date of transition will be announced together by all exchanges available to trade.
Effects such as preference shares, warrants, rights rights, part of paid shares and securities issued in differential voting rights (DVR) will be transmitted to settlement T + 1 along with the stock of the parent company.
Furthermore, more than 5,000 securities registered by exchange in the exchanges equity segment will be transmitted to the T + 1 settlement cycle along with the last Sekuritas batch determined by the exchange.
Every security registered.
Post the date of trading batch Securities last by ranking arrived will be immediately introduced to the T + 1 settlement cycle.