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SEBI clarifies on rolling settlement list

India's market regulator said on Friday that it has not yet decided on shares from the A Group for compulsory rolling settlement.

The Securities and Exchange Board of India said that it was issuing this statement due to rumours about rolling settlements.

The A Group at the Bombay Stock Exchange and six regional exchanges, comprises of leading shares in which transactions can be carried forward from one weekly settlement to another.

The rolling settlement refers to a T+5 cycle, with deals settled on the fifth day of trade.

It said that certain facilities like continuous net settlement, modified carry forward system and automated lending and borrowing mechanism would have to be put in place to expand the number of shares in the rolling settlement.

The ALBM allows investors to meet their settlement obligations by borrowing shares or funds in a special session.

There are currently compulsory rolling settlements in 163 shares.

SEBI said it would decide on including A Group shares in the compulsory rolling settlement, after giving sufficient notice to market participants.

It said stock exchanges have said the software changes needed to introduce compulsory rolling settlement would be in place by November.

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