Why does Zerodha increase intraday margins for MIS and CO on days when the market is volatile?

Margins are collected from customers to prevent defaults based on minimum exchange requirements. Margin requirements are adjusted based on the volatility of a security - more volatility means higher margins, and less volatility means lower margins.  However, during events such as election results or budget day, minimum margin requirements set by exchanges may not reflect the actual market volatility. To manage this, Zerodha may increase margins higher than the minimum required by the exchanges. Once the volatility subsides or the event passes without any volatility, Zerodha will revert to the minimum required margins. MIS can also be disabled for certain securities depending on the market volatility.