Block Deal

A block deal is a single, large, pre-negotiated trade between two parties executed through a separate block-deal window on the exchange, at a price within a narrow band around the prevailing market price.

Because dumping a very large order into the normal order book would move the price against both sides, exchanges provide dedicated block-deal windows (short morning and afternoon sessions) where two parties who have already agreed a trade can cross it cleanly. SEBI requires a minimum deal size (set in crores of rupees) and confines the execution price to a narrow band around the reference market price, and the shares cannot be squared off intraday.

Block deals are the standard route for marquee transactions: private-equity exits, promoter stake sales to institutions, and large fund-to-fund transfers. The exchange discloses executed block deals with participant names, so the list is scanned daily for signs of who is entering or exiting a stock.

The contrast with bulk deals: a block deal is one negotiated trade in a special window; a bulk deal is ordinary market trading by one client that happens to cross 0.5% of the company's equity in a day.

How stocks tend to react

The market reaction depends on who is trading and why: a promoter selling a large block is often read cautiously, while a reputed institution buying one is read as endorsement. A block placed at a discount to the market price frequently drags the stock toward the deal price in the short term.

MarketPing measures this instead of guessing: every analysed announcement carries the stock's actual price reaction across 14 horizons, and the Reaction Lab aggregates how each category of announcement has historically moved stocks.

Related terms

Educational content, not investment advice. Regulations and tax rules change — verify current rules before acting.