The Bombay Stock Exchange (BSE) has revealed a list of 25 stocks eligible for the T+0 settlement cycle, effective from today, March 28. This new development marks a departure from the traditional T+1 settlement cycle currently in operation across Indian markets.
Among the prominent stocks included in the eligibility list are Ambuja Cements, Ashok Leyland, Bajaj Auto, Bank of Baroda, BPCL, Cipla, as well as three Tata Group stocks, among others. This move comes as part of the Securities and Exchange Board of India's (Sebi) initiative to introduce the beta version of the T+0 trade settlement cycle.
Under this framework, the T+0 settlement cycle will be available on an optional basis and limited to a specific set of 25 scrips, with participation restricted to a limited number of brokers initially.
Sebi has highlighted that the introduction of a shorter settlement cycle is aimed at enhancing cost and time efficiency, promoting transparency, and bolstering risk management within the market ecosystem.
This strategic shift follows Sebi's prior initiatives to streamline settlement cycles, including reducing it from T+5 to T+3 in 2002 and further to T+2 in 2003.
Investors keen on participating in the T+0 settlement cycle must adhere to prescribed timelines, processes, and risk requirements set forth by Sebi.
Trading will be confined to a specified timeframe, operating between 9:15 am and 1:30 pm.
Additionally, prices within the T+0 segment will operate within a predetermined price band of +100 basis points from the prices in the regular T+1 market.
It's worth noting that while the T+0 settlement cycle offers expedited settlement, prices from this segment will not factor into index calculations or settlement price computations.
Contrary to speculation, the introduction of the T+0 settlement cycle does not signal the end of the existing T+1 settlement system. Instead, it will complement the traditional cycle, offering investors an alternative avenue for transaction settlement.
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