Description

Sundaram Mutual Fund temporarily suspends fresh subscriptions and new systematic plans in Sundaram Global Brand Theme - Equity Active FoF effective January 1, 2026 to avoid breach of industry-wide overseas investment limits set by RBI and SEBI.

Summary

Sundaram Mutual Fund has temporarily suspended acceptance of fresh subscriptions and new systematic investment registrations in Sundaram Global Brand Theme - Equity Active Fund of Fund effective January 1, 2026. This action is taken to prevent breach of industry-wide overseas investment limits prescribed by RBI and in accordance with SEBI Circular SEBI/HO/IMD/IMD II/DOF3/P/CIR/2021/571 dated June 3, 2021. The scheme invests 95% of its total assets in Sundaram Global Brand Fund, Singapore.

Key Points

  • Lumpsum subscriptions will not be accepted effective January 1, 2026
  • Fresh Systematic Investment Plans (SIP), Systematic Transfer Plans (STP), and Dividend Transfer Plans into the scheme will not be accepted from January 1, 2026
  • Existing SIP/STP instalments as on January 1, 2026 may continue subject to offer document compliance
  • Lumpsum subscription or switch-in applications received after December 31, 2025 cut-off time will not be processed
  • Switch-out transactions and dividend transfer instalments effective January 1, 2026 will be blocked for investment into this FoF
  • Redemptions, switch-outs, systematic withdrawal plans remain unaffected
  • Intra-scheme and intra-plan switches continue without change
  • Investments by designated employees in line with SEBI circulars continue without change
  • Suspension is temporary and will continue until regulatory limit enhancement

Regulatory Changes

The suspension is implemented pursuant to:

  • SEBI email dated January 28, 2022
  • AMFI clarification dated January 30, 2022
  • SEBI Circular no. SEBI/HO/IMD/IMD II/DOF3/P/CIR/2021/571 dated June 3, 2021
  • RBI prescribed industry-wide overseas investment limits

The measure ensures compliance with regulatory caps on overseas investments by mutual fund schemes.

Compliance Requirements

  • Sundaram Mutual Fund must block fresh lumpsum subscriptions from January 1, 2026
  • New systematic plan registrations (SIP/STP/DTP) into the scheme must be rejected
  • Applications received post cut-off time on December 31, 2025 must not be processed
  • Switch-in and dividend transfer transactions effective January 1, 2026 must be blocked
  • The addendum forms an integral part of the SID/KIM/SAI documents

Important Dates

  • December 30, 2025: Circular issued
  • December 31, 2025: Last date for acceptance of lumpsum/switch-in applications (before cut-off time)
  • January 1, 2026: Effective date of subscription suspension
  • Until further notice: Duration of temporary suspension (pending regulatory limit enhancement)

Impact Assessment

Investor Impact: Investors seeking fresh exposure to global brand themes through this fund will need to explore alternative schemes. Existing investors with running SIPs can continue their systematic investments, and redemption facilities remain fully operational.

Market Impact: Limited, as this affects a single fund of fund scheme focused on overseas investments. The measure is precautionary to maintain regulatory compliance.

Operational Impact: The fund house must update systems to block new subscriptions while allowing existing systematic plans and redemptions to continue seamlessly. Investor communication and query handling will be critical during the suspension period.

Impact Justification

Affects only investors in a specific mutual fund scheme. Temporary measure to comply with regulatory limits on overseas investments. Existing SIPs continue, redemptions unaffected.