New Delhi, Feb. 27 -- One of India's most popular sectoral stock market indices-Bank Nifty-may require a reconstruction, as the regulator moves to reduce the possible risks of price manipulation and excessive volatility.

The Securities and Exchange Board of India (Sebi) believes that the concentration of weights among the top few index constituents gives rise to "fears or risks of market manipulation and /or excessive market volatility" among market participants. The regulator proposed a set of measures in a consultation paper on Monday, seeking public comments through 17 March.

In terms of popularity on the derivatives segment, the Bank Nifty from NSE and Bankex from BSE, to a lesser extent, are next only to benchmarks like the Nifty a...