**Asset Management Companies (AMCs)** of Mutual Funds managing passive ETFs (including Equity, Debt, and Commodity ETFs). **Stock Exchanges** operating ETF trading platforms. **Trading Members** and market participants executing trades in ETF units. **Investors** trading in Exchange Traded Funds.

**Base Price Calculation**: Shifting from T-2 Day closing NAV (which causes a one-day lag and requires manual adjustments for corporate actions) to T-1 Day metrics. The proposed base price options for T Day are: Closing price of ETFs on T-1 Day (weighted average traded price of the last 30 minutes). Average iNAV of the last 30 minutes on T-1 Day. Closing NAV of T-1 Day (if available). **Price Bands for Equity/Debt Index ETFs**: Replacing the fixed +20% band with an initial +10% band. This band can flex up to +20% during the trading day with a 15-minute cooling-off period (or 5 minutes if within the last 30 minutes of trading) and a 5% relaxation limit (maximum of two flexing instances per day). Flexing requires meeting specific conditions (minimum 50 trades, 10 unique UCCs, and 3 Trading Members on each side of the trade at or above 9.90%). **Price Bands for Commodity (Gold/Silver) ETFs**: Replacing the fixed +20% band with an initial +6% band (aligned with the 9% Aggregate DPL in SEBI circular SEBI/HO/CDMRD/DNPMP/CIR/P/2021/9). It can flex up to +20% in stages of 3% with a 15-minute cooling-off period. **Overnight (TREPs) ETFs**: No change; the existing fixed price band of +5% will continue.

How is SEBI proposing to review ETF price bands and base prices?

Quick summary

SEBI is proposing to review the base price and price bands for Exchange Traded Funds (ETFs). The consultation paper suggests shifting from T-2 Day closing NAV to T-1 Day metrics for base price determination and replacing fixed price bands with dynamic, flexing price bands for equity, debt, and commodity ETFs.

Who is affected

Asset Management Companies (AMCs) of Mutual Funds managing passive ETFs (including Equity, Debt, and Commodity ETFs).
Stock Exchanges operating ETF trading platforms.
Trading Members and market participants executing trades in ETF units.
Investors trading in Exchange Traded Funds.

What changes

Base Price Calculation: Shifting from T-2 Day closing NAV (which causes a one-day lag and requires manual adjustments for corporate actions) to T-1 Day metrics. The proposed base price options for T Day are:
Closing price of ETFs on T-1 Day (weighted average traded price of the last 30 minutes).
Average iNAV of the last 30 minutes on T-1 Day.
Closing NAV of T-1 Day (if available).
Price Bands for Equity/Debt Index ETFs: Replacing the fixed +20% band with an initial +10% band. This band can flex up to +20% during the trading day with a 15-minute cooling-off period (or 5 minutes if within the last 30 minutes of trading) and a 5% relaxation limit (maximum of two flexing instances per day). Flexing requires meeting specific conditions (minimum 50 trades, 10 unique UCCs, and 3 Trading Members on each side of the trade at or above 9.90%).
Price Bands for Commodity (Gold/Silver) ETFs: Replacing the fixed +20% band with an initial +6% band (aligned with the 9% Aggregate DPL in SEBI circular SEBI/HO/CDMRD/DNPMP/CIR/P/2021/9). It can flex up to +20% in stages of 3% with a 15-minute cooling-off period.
Overnight (TREPs) ETFs: No change; the existing fixed price band of +5% will continue.

Action items

Stakeholders are invited to submit comments and suggestions on the proposals (including base price options, proposed price bands, removing the upper limit for commodity ETFs, and introducing a separate pre-open session for commodity-based ETFs).
Submit comments online by March 06, 2026, using the following link:

https://www.sebi.gov.in/sebiweb/publiccommentv2/PublicCommentAction.do?doPublicComments=yes

In case of technical issues, email comments to pankajc@sebi.gov.in and mrd_pod3@sebi.gov.in with the subject line: "Review of provisions related to Base Price and Price Bands for Exchange Traded Funds (ETFs)".

Key dates-deadlines

February 13, 2026: Date of issuance of the consultation paper.
March 06, 2026: Deadline for submitting public comments.

Source reference

Source Document: SEBI Consultation Paper on "Review of provisions related to Base Price and Price Bands for Exchange Traded Funds (ETFs)"
Issue Date: February 13, 2026
Footnote Reference: SEBI Circular SEBI/HO/CDMRD/DNPMP/CIR/P/2021/9 dated January 11, 2021 (referenced in relation to the Aggregate DPL of 9%)