Many new investors in the stock market often ask: Can I sell delivery shares on the same day? The short answer is yes, but it depends on several factors. In this article, we will explore what delivery shares are, the difference between delivery and intraday trading, and whether it’s possible—or practical—to sell those shares on the same day you buy them.
If you’re looking to invest smartly and avoid penalties, this guide will help you understand how same-day delivery share sales work in India and other global markets.
What Are Delivery Shares?
Delivery shares are stocks you buy with the intention of holding them beyond one day. When you purchase shares in delivery mode, those stocks get transferred to your Demat account after a T+1 settlement period (i.e., one trading day after the transaction).
Here are some key features of delivery shares:
- Full payment is required.
- Shares are delivered to your Demat account.
- Ideal for medium to long-term investment.
- Not subject to intraday square-off rules.
Difference Between Intraday and Delivery Trading
Understanding the difference is key to answering whether you can sell delivery shares on the same day.
In intraday trading, you buy and sell shares within the same trading session. With delivery trading, you take actual ownership of the stock.
Can I Sell Delivery Shares on the Same Day?
Technically, yes, you can sell delivery shares on the same day. But there are two different scenarios here:
1. Shares Bought Today in Delivery Mode
If you buy shares in delivery mode and try to sell them on the same day, it’s called a BTST trade—Buy Today, Sell Tomorrow.
Even though the stock hasn’t yet reached your Demat account (because of the T+1 settlement), many brokers allow you to sell those shares the same day or the next day.
However, there’s a risk involved: if the broker or exchange fails to deliver the shares on settlement day, you could face auction penalties.
2. Shares Already in Demat Account
If you already own delivery shares from previous purchases, you can sell them any day you like—including today. There is no restriction. These shares are already in your Demat, so when you place a sell order, they are debited and delivered to the buyer via the exchange.
BTST (Buy Today Sell Tomorrow) Explained
BTST is a special feature that allows investors to sell delivery shares before they are credited to the Demat account. This is often used when investors expect a quick price rise and want to book profit immediately.
Risks of BTST
- Auction Risk: If your broker fails to get shares from the exchange, you may end up in a short delivery situation.
- No Margin for BTST: Some brokers don’t offer margin for BTST orders.
- Stock Not Eligible: Not all stocks are allowed for BTST by brokers or exchanges.
Benefits of BTST
- Quick profit without waiting for T+1 settlement.
- Avoids blocking funds for 1–2 days.
- No need to use intraday margin.
What Happens If I Sell Before Delivery?
If you try to sell shares before they reach your Demat account (and your broker doesn’t support BTST), you might face:
- Short delivery: The shares cannot be delivered to the buyer.
- Auction penalty: You may be fined, often up to 20% of the trade value.
- Broker charges: Some brokers charge fees for failed deliveries.
Always check with your broker before attempting such trades.
SEBI Guidelines on Same-Day Delivery Share Sales
SEBI (Securities and Exchange Board of India) has made it clear that:
- T+1 settlement applies to most stocks.
- Selling delivery shares the same day is allowed only if the broker offers BTST facility.
- Investors must be cautious of auction risks.
Therefore, SEBI doesn’t prohibit same-day selling of delivery shares, but it urges traders to understand the risks and mechanisms involved.
Can I Sell Zerodha Delivery Shares on the Same Day?
Zerodha is one of India’s largest brokers, and it does allow BTST trades. So, if you buy shares in delivery mode and wish to sell them the same day, Zerodha usually permits that.
However:
- BTST is available only for liquid stocks.
- There’s no margin benefit.
- Short delivery risk still applies.
Always verify with the Zerodha Kite platform before executing same-day delivery share sales.
Taxation on Selling Delivery Shares Same Day
Selling delivery shares on the same day may affect your capital gains tax classification.
But if you sell delivery shares on the same day, it might be treated as a trading activity and fall under business income (if done frequently).
Talk to your tax advisor if you’re an active trader.
Should You Sell Delivery Shares on the Same Day?
Here are some pros and cons to help you decide.
Pros:
- Quick profit-taking.
- Takes advantage of price volatility.
- Reduces exposure to overnight risk.
Cons:
- Risk of auction penalty.
- No control over settlement delays.
- Some brokers may not support BTST.
- Might be taxed as business income.
Tips Before Selling Delivery Shares Same Day
- Check BTST Eligibility: Not all brokers support it.
- Ensure Liquidity: Avoid illiquid or low-volume stocks.
- Understand Risks: Short delivery and penalty can eat your profits.
- Use Trusted Brokers: Platforms like Zerodha, Upstox, Angel One are BTST-friendly.
- Avoid Penny Stocks: These have higher risk of auction due to settlement failures.
What If the Market Closes Before I Sell?
If the market closes and you didn’t sell your shares, then they’ll be credited to your Demat account the next day (T+1). You can sell them afterward without any problem.
FAQs
Can I sell delivery shares within minutes after buying?
Only if your broker supports BTST. But remember, you don’t own them officially until the next trading day.
Will I get profit if I sell delivery shares same day?
Yes, if the share price goes up after your purchase. Your net profit will be the difference minus brokerage, taxes, and possible penalties.
Can I convert delivery trade to intraday?
Yes, most brokers allow this before the market closes, but only if the shares haven’t been already delivered.
What if I sell shares that I don’t own?
That’s called short selling and is only allowed in intraday trading—not in delivery mode. You can face penalties if done improperly.
Conclusion
So, can you sell delivery shares on the same day? Yes, you can—but only under specific circumstances. The BTST facility allows traders to do it, but with some risk involved. If you already have shares in your Demat, then there’s no issue—you can sell anytime.
Make sure to understand the difference between intraday and delivery trading. Use trusted brokers, check eligibility, and trade wisely. Knowing your broker’s rules and SEBI’s guidelines will keep you safe from unnecessary penalties and risks.
