Zerodha Warns of Revenue Impact from New Market Auction Rules

Zerodha CEO Nithin Kamath warned that the new Closing Auction Session (CAS) for F&O stocks, starting August 3, could reduce the brokerage's income by 1% to 5%.

The new system replaces the volume-weighted average price (VWAP) method with a single equilibrium price, aiming to reduce price manipulation by large institutional orders.

Market closing times will now be staggered, with F&O stocks ending at 3:15 pm, non-F&O stocks at 3:30 pm, and derivatives at 3:40 pm, a change expected to cause initial investor confusion.