SEBI Proposed Changes to IPO and Re-listed Stock Price

On 21st May 2026, the Securities and Exchange Board of India (SEBI) released a consultation paper on proposing changes to the price discovery mechanism used during the pre-open call auction session for IPOs and re-listed stocks.

The regulator stated that the review aimed to improve price discovery and address concerns related to artificially suppressed pricing in certain re-listed shares.
SEBI observed that the existing dummy price band and base price mechanisms sometimes led to rejection of a large number of buy orders during call auction sessions.
The regulator proposed revising the methodology used for determining the base price of re-listed stocks, particularly for companies resuming trading after long suspension periods.
SEBI also suggested introducing a more uniform and immediate mechanism for flexing dummy price bands across stock exchanges.
The proposals were discussed with the SEBI Secondary Market Advisory Committee.