Patanjali Foods, Thomas Cook, and MMTC shares rise after price band revision

Patanjali Foods, Thomas Cook, and MMTC shares edged higher in the morning trade on Thursday, December 7, after the price band of the company's stock was lifted from 5 per cent to 10 per cent on the BSE.

At around 10:10 a.m., shares of Patanjali Foods were up 2.99 per cent, MMTC was up 7.77 per cent and Thomas Cook was up 1.20 per cent on BSE. Adani Green Energy and Adani Total Gas shares also traded higher after their price band was increased from 10 per cent to 20 per cent. 

"Trading Members of the Exchange are hereby informed that, as a part of a review of the surveillance action, the price bands are revised in the various scrips. The revised price band will be effective from November 7, 2023," BSE said in its notice.

What is a price band?

A price band is a value-setting method in which a seller indicates an upper and lower cost range, between which buyers place bids. Apart from the above-mentioned stocks, 438 stocks' price bands have also been revised.

Why a revision in the price band?

Bourses revise the price band as a part of a review of the surveillance action. BSE uses a circuit filter mechanism to check excessive volatility in a scrip. It is the maximum fluctuation that is allowed in a stock in a day.

Market watchdog Securities and Exchange Board of India (SEBI) has prescribed that all individual scrips will have appropriate price bands up to 20 per cent either way, except for the scrips having derivatives products on them.

Accordingly, the stock exchanges, as a surveillance measure, revise the price bands of the scrips. The said revision is based on the pre-determined objective criteria jointly decided by the exchanges in consultation with SEBI.

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