Summary
Stocks belonging to the periodic call auction scheme are largely illiquid, with average daily turnover of less than ₹2 lakhs over the last 2 quarters, in accordance with NSE standards. The orders are collected prior to execution and not traded on a continuous basis.
NSE conducts 6 periodic call auctions from 9:30 AM till 3:30 PM. Each period lasts an hour, with order entry possible within 45 minutes, and the period closes randomly between the 44th and 45th minutes.
It offers a systematic method of price discovery, but the investor must be aware of the risks associated with the process. According to the NSE, the maximum price band for these securities is 20%.
What is a periodic call auction stock?
A periodic call auction stock is a security in which buy and sell orders are collected during specified periods and matched at an equilibrium price instead of being continuously matched throughout the trading day.
In NSE’s framework for illiquid securities, a stock may be classified as illiquid if its average daily turnover is below ₹2 lakh for the previous two quarters and it is classified as illiquid on all exchanges where it trades, subject to prescribed exclusion conditions. Exchanges review such securities periodically.
Periodic call auction timings
NSE conducts periodic call auctions for illiquid instruments through six one-hour periods between 9:30 AM and 3:30 PM. These are conducted at six time slots:
- 9:30-10:30 AM,
- 10:30-11:30 AM,
- 11:30 AM-12:30 PM,
- 12:30-1:30 PM,
- 1:30-2:30 PM
- 2:30-3:30 PM.
In each of the six periods, 45 minutes are allocated for order placement, modification, and cancellation. At a random point between the 44th and 45th minutes, order entry closes automatically. This is followed by 8 minutes for order matching and trade confirmation and a 7-minute buffer before the next session begins.
Why do exchanges use periodic call auctions?
Periodic call auctions enable exchanges to handle illiquid securities by collecting orders in scheduled periods due to low liquidity.
- Concentrated order flow: Buy and sell orders are collected before matching rather than being executed individually as they arrive.
- Price discovery: The collected orders are used to determine an equilibrium price at which the highest executable volume can be matched.
- Managing illiquid securities: Scheduled auctions provide a defined trading process for securities with limited liquidity.
- Market surveillance: Periodic call auctions may also be imposed as part of exchange surveillance measures in certain securities.
Which stocks are traded in the call auction system?
Periodic call auctions are used for securities placed under the exchange’s periodic call auction framework. This includes eligible illiquid securities and stocks placed under certain surveillance measures. Under ESM Stage II, for example, securities trade through periodic call auctions on all trading days, along with Trade-to-Trade settlement and a 2% price band.
The table below shows selected stocks under ESM Stage II and their market capitalisation as of 17 September 2026.
| Stock Name | Market Cap |
| Prizor Viztech Ltd. | ₹1,219 Cr |
| Amanta Healthcare Ltd. | ₹738 Cr |
| Bafna Pharmaceuticals Ltd. | ₹736 Cr |
| Euro India Fresh Foods Ltd. | ₹656 Cr |
| Viji Finance Ltd. | ₹340 Cr |
| Minal Industries Ltd. | ₹101 Cr |
| Supreme Engineering Ltd. | ₹86.2 Cr |
| Uma Exports Ltd. | ₹69 Cr |
| Newjaisa Technologies Ltd. | ₹65.1 Cr |
| Jalan Transolutions (India) Ltd. | ₹2.54 Cr |
How Periodic Call Auction Works in Stock Markets
It differs from regular continuous trading in that orders are collected before being matched. It involves the following stages:
- Order Entry: Buyers and sellers submit their orders during the order entry stage, which may include modifications or cancellations of orders in accordance with exchange guidelines.
- Random End to Order Entry Stage: The end of the order entry stage doesn’t have to occur at precisely the same time in every trading session. The NSE allows for system-driven random closure within the final minute of the order entry stage.
- Matching of orders: Once orders are assembled, the exchange determines the price at which qualified orders can be matched. The process of matching will depend on the amounts and the prices of the orders in the books.
- Confirmation of orders: After the matching process, orders become trades, and confirmation occurs. The unmatched orders will remain active until the next call auction process, depending on the exchange’s rules.
- Start of the next auction process: Once the current auction process is over, the next call auction takes place, with trading intervals.
Key Features and Mechanism of Call Auction System
Key rules of NSE’s periodic call auction framework for illiquid securities include:
- Quarterly review: Exchanges identify eligible illiquid securities periodically and move securities into or out of the mechanism based on the prescribed criteria.
- Price band: A maximum price band of 20% applies under the illiquid-security framework, although exchanges may impose a narrower band.
- Carry-forward of orders: Unmatched orders may remain valid during the trading day and move to a subsequent call auction session.
- Advance notice: Exchanges provide notice before securities enter or exit the periodic call auction mechanism.
Benefits of Periodic Call Auction for Investors & Traders
The mechanism may offer practical benefits, especially when handling securities with low trading volume.
- Concentrated liquidity: Collecting orders over a defined period can bring available buyers and sellers together before matching.
- Transparent price discovery: Trades are executed through the exchange’s auction-based price discovery mechanism rather than through private negotiation.
- Defined trading windows: Investors know when orders can be placed and when matching is scheduled to occur.
Risks, Limitations & Common Mistakes
There are also certain weaknesses of periodic call auctions that investors need to know prior to submitting orders.
- Liquidity issues: One major drawback is that there may be few buyers or sellers. It means that a submitted order will not be fully executed due to the absence of necessary matched orders.
- Execution delay: Unlike continuous trading, the submitted order will not execute immediately; investors must wait until the corresponding auction and matching occur.
- Orders should be treated with caution: Prior to placing an order, investors must familiarise themselves with the various types of orders permitted by the exchange. A lack of sufficient liquidity on the other side might be a problem with an illiquid asset.
- An unmatched order can stay unmatched: A failed attempt at matching the order can result in the order being unmatched and will be carried forward to the following session. Investors should ensure that their orders have been processed.
- Do not confuse auction trading with normal trading: Having a stock available for trade on an exchange does not imply continuous trading of that stock. Investors must find out whether the stock is on the exchange’s list for auction calls.
Final Thoughts:
A periodic call auction is a unique trading arrangement used primarily for illiquid securities. Unlike continuous matching, where exchanges constantly match orders, in this case, exchanges aggregate orders within predefined sessions and then match them using an auction mechanism.
Currently, in India, the NSE holds six one-hour sessions for qualifying illiquid stocks from 9:30 AM to 3:30 PM. While this trading method facilitates price discovery and pre-planned trading, investors may encounter some liquidity and execution risks. Prior to placing any order, an investor needs to consider the following factors.
FAQs
Yes, periodic call auction is a stock trading procedure adopted by exchanges for specific stocks. Orders are aggregated in a particular period of time and then matched at a certain price. It differs from continuous trading, in which orders may be matched at any time during the session.
No, periodic call auctions occur within a specified period. For example, the NSE holds six hourly sessions for eligible illiquid stocks between 9:30 AM and 3:30 PM. In these sessions, orders are aggregated and matched.
Yes, price discovery is an essential element in the call auction process. The exchange examines all buy and sell orders and determines a price at which the maximum possible orders can be matched.
Not all stocks trade using this mechanism. The periodic call auction is mostly applicable to securities which are considered illiquid by exchanges. Exchanges periodically identify the eligible securities and release the respective list.
No, this mechanism is more applicable to illiquid securities than highly liquid stocks. Such stocks could be those that experience low trading volume. Placing orders ahead of matching helps create an organised trading process for such stocks.
Yes, retail investors can trade in periodic call auctions if the particular security is eligible to be traded using the periodic call auction method. Retail investors can place their buy and sell orders during the designated order submission time. However, trade execution depends on matching with an order.
