New Student Offer - HELLO

Join Here

Sebi tightens norms for IPO price discovery to curb manipulation

Published on June 20, 2024
Current Context: The Securities and Exchange Board of India (SEBI), the capital market regulator in India, has implemented stricter rules for determining the opening price of stocks following an initial public offering (IPO).
Sebi tightens norms for IPO price discovery to curb manipulation
  • This aims to prevent manipulation during the price discovery process.
  • Here's a breakdown of what SEBI has done:
    • Increased Scrutiny in the Pre-Open Call Auction: This is a one-hour session before the stock starts trading where investors place bids. SEBI has tightened surveillance to identify and potentially penalize suspicious activity.
    • Focus on Order Matching: The first 45 minutes of the pre-open session allows for placing, modifying, or canceling orders. SEBI aims to ensure these orders are genuine reflections of investor interest.
    • Shorter Order Matching Window: The following 10 minutes are dedicated to matching these buy and sell orders to determine a fair equilibrium price for the stock.
    • Buffer Period: The remaining five minutes act as a buffer to smoothly transition from the pre-open session to regular trading.


1 As per the new norms of SEBI for IPOs, During the pre-open call auction, investors can place bids for how long before trading begins,?

  • A) 30 minutes
  • B) 45 minutes
  • C) 15 minutes
  • D) 1 hour
ebook store

About us

ramandeep singh

Ramandeep Singh, your guide to banking and insurance exams. With 14 years of experience and 5000+ selections, Ramandeep understands the path to success, having transitioned himself from Dena Bank and SBI. He's passionate about helping you achieve your banking and insurance dreams.

  • Follow me:
Close Menu
Close Menu