Description
Sundaram Mutual Fund temporarily suspends fresh subscriptions and new SIP registrations in Sundaram Global Brand Theme - Equity Active FoF from January 1, 2026 to avoid breach of RBI overseas investment limits.
Summary
Sundaram Asset Management Company has announced a temporary suspension of fresh subscriptions in Sundaram Global Brand Theme - Equity Active Fund of Fund effective January 1, 2026. This measure is being implemented to avoid breach of industry-wide overseas investment limits set by RBI, following SEBI’s directive pursuant to email dated January 28, 2022 and AMFI clarification dated January 30, 2022. The scheme invests 95% of its total assets in units of Sundaram Global Brand Fund, Singapore.
Key Points
- Lumpsum subscriptions will not be accepted from January 1, 2026
- Fresh Systematic Investment Plan (SIP) registrations including Systematic Transfer Plans and Dividend Transfer Plans will not be accepted from January 1, 2026
- Existing SIP/STP instalments as on January 1, 2026 may continue subject to compliance with offer document
- Lump sum subscription or switch-in applications received post cut-off timing of December 31, 2025 will not be processed
- Switch-out transactions or dividend transfer instalments effective January 1, 2026 will be blocked for investment into this FoF
- Redemptions, withdrawals, and existing systematic withdrawal plans will continue without change
- Intra-scheme and intra-plan switches will continue normally
- Investments by designated employees under SEBI alignment of interest requirements will continue
- The suspension is temporary and will continue until regulatory limit enhancement
Regulatory Changes
This action is taken in compliance with:
- SEBI Circular no. SEBI/HO/IMD/IMD II/DOF3/P/CIR/2021/571 dated June 03, 2021
- SEBI email dated January 28, 2022
- AMFI clarification dated January 30, 2022
- RBI overseas investment limits for mutual fund industry
The measure aims to prevent breach of industry-wide overseas investment limits as the scheme invests 95% of assets in overseas securities (Sundaram Global Brand Fund, Singapore).
Compliance Requirements
For Investors:
- No fresh lump sum investments can be made from January 1, 2026
- No new SIP/STP/DTP registrations will be accepted from January 1, 2026
- Applications received after December 31, 2025 cut-off time will be rejected
- Existing SIPs/STPs can continue as per offer document terms
For AMC:
- Must block acceptance of fresh subscriptions and switch-ins from January 1, 2026
- Continue processing existing systematic plans, redemptions, and withdrawals
- Maintain all other scheme terms unchanged
- Monitor for regulatory limit enhancement to resume subscriptions
Important Dates
- December 31, 2025: Last date for lump sum subscription acceptance (before cut-off time)
- January 1, 2026: Effective date for suspension of fresh subscriptions and new SIP/STP/DTP registrations
- December 30, 2025: Date of circular issuance
Impact Assessment
Impact on Investors:
- New investors cannot enter the scheme from January 1, 2026
- Existing SIP investors can continue their investments
- Exit options remain fully available through redemptions and systematic withdrawal plans
- Investors seeking exposure to global brand themes through this FoF will need to wait for suspension lifting
Market Impact:
- Limited to specific fund investors; no broader market impact
- Reflects industry-wide constraint on overseas investments due to regulatory limits
- Similar measures may be adopted by other FoFs investing in overseas securities if limits are approached
Operational Impact:
- Sundaram AMC must implement transaction blocking systems from January 1, 2026
- Units allotment will be restricted except for pre-existing systematic plans and redemptions
- The temporary nature suggests resumption once RBI/SEBI enhance overseas investment limits
Impact Justification
Affects specific mutual fund scheme investors but does not impact broader market operations. Temporary measure to comply with regulatory overseas investment limits.