Glossary

Dummy Price Band

The safety range that caps how far an IPO's price can move during the pre-open auction, currently -50% to +100% of issue price for mainboard IPO listings.

What It Means

A dummy price band is the safety range an exchange sets around an IPO's issue price during the special pre-open session, limiting how far the auction's computed equilibrium price can move before the exchange treats it as an error rather than a genuine trade.

How It Works

The band is set as a percentage of the issue price, and it's wider than most investors expect: at the time of writing, it's -50% to +100% for a regular mainboard IPO, -90% to +90% for an SME IPO, and -85% to +50% for a re-listed stock. A computed price landing anywhere inside that range gets accepted as valid; the exchange only steps in if the number would fall outside it. These figures get reviewed by SEBI from time to time, so confirm the live band before treating any specific percentage as fixed.

Dummy Price Band (IPO Listing) Explained | TraderStack