Description

ICICI Prudential temporarily suspends fresh subscriptions and new SIP/STP registrations in Silver ETF Fund of Fund due to elevated domestic silver prices and supply constraints.

Summary

ICICI Prudential Asset Management Company has temporarily discontinued all fresh subscriptions in ICICI Prudential Silver ETF Fund of Fund effective October 14, 2025. The suspension covers lump sum investments, switches, and new SIP/STP registrations. This action is taken to protect investor interests due to domestic silver prices rising significantly above global benchmarks caused by local supply shortages. Existing systematic transactions registered before October 14, 2025 will continue to be processed, and redemptions remain permitted.

Key Points

  • Temporary suspension of all fresh subscriptions (lump sum and switches) effective October 14, 2025
  • New SIP and STP registrations suspended with effect from October 14, 2025
  • Existing SIP/STP registered prior to October 14, 2025 will continue to be processed
  • Redemptions and switch-outs will continue normally as per SID terms
  • Suspension caused by domestic silver prices trading at significant premium to global benchmarks
  • Premium attributed to local supply constraints in physical silver bullion market
  • Supply shortage expected to continue in near future
  • Inflated prices of Silver ETFs on exchange due to supply-demand imbalance
  • Purchase or switch-in transactions timestamped on or before 3:00 PM of October 13, 2025 will be processed at applicable NAV

Regulatory Changes

No regulatory changes announced. This is an operational decision by the fund house under existing regulatory framework to protect investor interests during market disruption.

Compliance Requirements

  • AMC to continue processing existing systematic transactions registered prior to October 14, 2025
  • All redemption requests to be processed as per existing SID terms
  • AMC to issue further notice when subscriptions are resumed
  • Investors advised to periodically review and update KYC details including mobile number and email

Important Dates

  • October 13, 2025, 3:00 PM: Cut-off time for acceptance of purchase/switch-in transactions before suspension
  • October 14, 2025: Effective date of subscription suspension
  • Till Further Notice: Duration of suspension (temporary, date not specified)

Impact Assessment

Market Impact: The suspension highlights significant dislocation in domestic silver markets with prices substantially above global benchmarks. This reflects supply chain disruptions in physical silver availability in India. The inability of Silver ETF to create new units efficiently impacts the fund of fund structure.

Investor Impact: High impact on investors seeking fresh exposure to silver through this fund vehicle. Existing investors with running SIPs can continue, but no new investors can enter. Redemption facility remains available, providing liquidity to existing investors. The action protects new investors from entering at potentially inflated valuations while the premium persists.

Operational Impact: The fund structure (FOF investing in ETF) becomes vulnerable when the underlying ETF trades at significant premium to NAV due to creation/redemption constraints. This demonstrates risk inherent in commodity ETF structures during supply disruptions. The suspension is investor-friendly but reduces product availability in the silver investment segment.

Impact Justification

Complete suspension of fresh investments in a commodity ETF FOF affects investor access and reflects significant market disruption in domestic silver prices due to supply constraints