Block Deal Window
The Block Deal Window is a dedicated trading session on NSE and BSE, held in the morning (9:15 AM to 9:50 AM) and afternoon (2:05 PM to 2:50 PM), in which large single-transaction trades of a minimum value of ₹10 crore in a listed security can be executed between counterparties at a negotiated price within a permitted band around the prevailing market price.
Block deals were introduced by SEBI to provide large investors — particularly institutional investors, promoters, and private equity funds — with a regulated mechanism to execute substantial securities transactions without the price impact that would result from placing such orders in the regular market session. The current framework, revised through SEBI circulars in 2013 and subsequently updated, provides two daily windows: a morning session from 9:15 AM to 9:50 AM and an afternoon session from 2:05 PM to 2:50 PM.
For a transaction to qualify as a 'block deal,' it must involve a single order for shares with a minimum trade value of ₹10 crore (this threshold was raised from ₹5 crore). The price at which the block deal is executed must be within ±1% of the prevailing market price (or the previous day's closing price in the morning window). Both buyer and seller must be institutional investors (FPIs, domestic mutual funds, insurance companies, PMS clients, AIFs) or other large investors, and the transaction must be pre-negotiated — the buyer and seller agree on price and quantity before entering the window.
Block deals are not subject to market impact cost in the same way as regular large orders because they are executed at a pre-agreed price and disclosed only after the window closes. The stock exchange discloses all block deals executed in a session by 6:00 PM on the same day, providing transparency to the market about large-lot price discovery without causing intra-session price disruption.
Important compliance dimensions: block deals by promoters or persons acting in concert must be reported as 'change in promoter shareholding' under LODR Regulations if they cross the prescribed disclosure threshold. Block deals by FPIs must also comply with FPI aggregate and individual ownership limits. Insider trading restrictions apply fully to block deal participants — any person in possession of UPSI cannot execute a block deal in the relevant security during the trading restriction window.
Block deals often serve as indicators of institutional sentiment: a large block sale by a prominent PE fund or a promoter may signal strategic exit or monetisation, while a large block purchase by an institutional investor may indicate accumulation at a specific price level.