Brokers rejoice the afternoon Muhurat Trading for the first time after 1957

Brokers rejoice the afternoon Muhurat Trading for the first time after 1957

On September 22 evening, NSE and BSE came up with a circular on Muhurat Trading timings for Diwali this year. It was a pleasant surprise for brokers, their staff, and other market participants. As per the NSE circular, the Muhurat Trading timing was shifted to the afternoon, 1:45 PM–2:45 PM, instead of the usual evening timing.

The broking industry was trying to convince exchanges, clearing corporations, and depositories to consider shifting the timing to the afternoon, as this would enable not only brokers’ staff but also staff of stocks exchanges, clearing corporations and others to be with their families on the occasion of the Diwali festival.

The idea was first discussed by first-generation broker Jay Prakash Gupta, Co-founder, Dhan, and supported by other brokers. It was discussed and pursued in the Brokers’ Industry Standards Forum (Brokers’ ISF). Gupta recalls that in 2023, though the Muhurat trading session was over before 8 PM, his staff had to be in the office till 11 PM due to the delay in the receipt of files from clearing corporations. A similar issue was raised by other brokers as well.

Gupta says, “I am extremely happy that this Diwali, employees of Broking Houses, Clearing Corporations, and Depositories will have time to celebrate the auspicious occasion with their families.” Gupta further says, “The change in Muhurat timing underscores the commitment of all stakeholders towards fostering a more supportive work environment while ensuring the continued efficiency of market operations. I commend the exchanges for their prompt and constructive response and remain committed to working collaboratively to further advance the interests and well-being of industry professionals.”

Dhiraj Reli, MD & CEO, HDFC Securities, says, “In the past, Muhurat trading was scheduled for the evening, reflecting the importance of traditional rituals. However, as capital markets have evolved, it has become clear that post-trading processing requires more time. The shift to afternoon timings is a positive development, allowing industry staff to effectively complete their tasks. This change enhances productivity and enables everyone, particularly those in back office, IT, and processing roles, to spend quality time with their families in the evening—a benefit often unfeasible with the old schedule.”

Uttam Bagri, MD, BCB Brokerage, says, “A vast majority of stockbrokers have welcomed the decision to shift Muhurat Trading timings to earlier in the day. This change provides much-needed time for essential post-trade back-office activities, which carry significant operational and compliance responsibilities. We sincerely hope that this adjustment becomes a permanent feature of Muhurat Trading in the years ahead.”

Brokers, in their letter to exchanges and clearing corporations, had sought either a shift in timing to the afternoon or a relaxation of the post-trade compliance requirements for Muhurat Trading day. Like permit certain processes, such as Early Pay-in and fund allocations, to be completed on the next trading day. Waiver of penalty due to peak margin shortage, EOD allocation to be allowed to be done before 9 AM of the next trading session.

Exchanges, after consultation with each other, agreed to the first proposal of shifting the Muhurat Trading timing.

According to brokers, with increasing compliance requirements and stringent reporting timelines, by the time employees complete post-trade processes, including allocation of funds, Early Pay-in of securities, etc., and return home, the essence and joy of Diwali are diminished.

They say, unfortunately, this situation often results in employees, including those of Stock Exchanges and Clearing Corporations, missing the opportunity to celebrate the festival with their families. This happens every year and has been happening for as long as anyone can remember.

A few spiritually minded markets participants say it may look a little odd for some time to adjust to an afternoon Muhurat Trading session, eventually it will be adopted by all. Market veterans recall that before this,  once in 2012 Muhurat trading session was conducted between 3: 45 PM-5:00 PM, which was based on auspicious timimg.

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Though a top exchange official said, “It’s not only the brokers request but also a good Muhurat timing which was considered before finalising the Muhurat Trading session. This year the good Muhurat was either in afternoon or at 11 PM in the night after consultation among exchanges the timing was fixed for afternoon”. On being asked if this can be a every year feature, the official said, “If all market participants agree then it can be considered”.

The Muhurat Trading timing is first decided by exchanges among themselves based on the auspicious timing of muhurat and then informally communicated to regulator for vetting.

Muhurat Trading, a long-standing tradition in Indian stock markets, is held every year on Diwali after worshiping goddess Laksmi, the godess of wealth and prosperity as per Hindu mythology.  The session marks the start of the new financial year as per the Vikram Samvat calendar. Currently, the Vikram Samvat year is 2082. Trading on Muhurat day is seen by investors as a symbolic gesture to usher in prosperity and wealth. Muhurat Trading was started in 1957 by BSE and since then has been happening in the evening only—usually between 5 PM–8 PM—but after that, many post-trade compliances have to be fulfilled.

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