Settlement holiday tomm - auction market closed

Zerodha
1

if someone makes a short delivery, how will their position be affected because auction market is closed tomorrow.

Will the settlement happen at a higher rate ?

2

A settlement holiday doesn’t automatically mean the settlement will happen at a higher price.

For example, if shares are sold at ₹100 on 25 Aug and 26 Aug is a settlement holiday:

  • 25 Aug: You sell at ₹100 but don’t have the shares to deliver and this becomes a short delivery.
  • 26 Aug: Settlement holiday where no auction/settlement happens.
  • 27 Aug: The auction/settlement process moves to the next applicable auction day.
  • The final amount depends on the auction/close-out price as per the rules.

So, if the auction price is ₹110, the short seller bears the additional cost as per the applicable settlement mechanism.

Hence, the final obligation depends on the auction/close-out price, not just the settlement holiday.

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