Description

Notice cum Addendum for merger of Tata Equity Savings Fund into Tata Balanced Advantage Fund with record date 20 February 2026 and 30-day exit option for unitholders.

Summary

The Trustees of Tata Mutual Fund have approved the merger of Tata Equity Savings Fund (Merging Scheme) into Tata Balanced Advantage Fund (Surviving Scheme), an open-ended dynamic asset allocation fund. The record date for the merger is 20 February 2026, and the effective date is 21 February 2026. Unitholders of both schemes will receive a 30-day exit option at prevailing NAV without exit load. Sale of units in Tata Equity Savings Fund will be suspended from 19 January 2026.

Key Points

  • Merger approved by Trustees of Tata Mutual Fund in accordance with Regulation 18(15A) of SEBI (Mutual Funds) Regulations, 1996
  • All plan options (Direct/Regular, Growth/IDCW Payout/IDCW Reinvestment) will be mapped to corresponding options in the Surviving Scheme
  • Units will be allotted at closing NAV of record date
  • Exit option available at prevailing NAV without exit load for 30 days
  • Unitholders not exercising exit option will be deemed to have consented to the merger
  • No entry load will be charged on allotment of units in Surviving Scheme
  • Written communication to be sent to all unitholders with merger details, tax implications, and financial information
  • Systematic investment facilities (SIP/STP/SWP) will automatically continue in the Surviving Scheme unless unitholders opt for exit
  • Unitholders of Tata Balanced Advantage Fund can continue holding existing units or exit during the exit period

Regulatory Changes

This merger is being conducted in compliance with Regulation 18(15A) of the SEBI (Mutual Funds) Regulations, 1996, which requires a 30-day exit option at prevailing NAV without exit load for unitholders of both merging and surviving schemes.

Compliance Requirements

For Tata Asset Management Pvt Ltd:

  • Suspend sale of units (including switch-in and registration of systematic investment options) in Tata Equity Savings Fund from 19 January 2026
  • Send written communication to unitholders of both schemes detailing merger basis, unit allocation, tax implications, and financial information
  • Process exit requests received until 3:00 PM on 20 February 2026
  • Issue fresh Account Statements to unitholders post-merger
  • Ensure automatic continuation of SIP/STP/SWP registrations in Surviving Scheme

For Unitholders:

  • Review merger details and decide whether to exercise exit option
  • Submit redemption/switch requests by 20 February 2026 (up to 3:00 PM) if not in favor of merger
  • No action required if consenting to merger - units will automatically transfer

Important Dates

  • 19 January 2026: Sale of units in Tata Equity Savings Fund suspended (including switch-in and SIP registrations)
  • 22 January 2026: Exit option period begins for unitholders of both schemes
  • 20 February 2026:
    • Record date for merger
    • Last date to exercise exit option (until 3:00 PM)
    • Exit option period ends
  • 21 February 2026: Effective date of merger; Tata Equity Savings Fund ceases to exist

Impact Assessment

For Tata Equity Savings Fund Unitholders:

  • High impact - mandatory migration to Tata Balanced Advantage Fund unless exit option is exercised
  • No new investments or systematic plans can be registered from 19 January 2026
  • Units will be automatically converted to corresponding plan/option in Surviving Scheme
  • Tax implications may arise from the merger (details to be provided in written communication)

For Tata Balanced Advantage Fund Unitholders:

  • Medium impact - existing holdings remain unchanged but fund will absorb assets from merging scheme
  • Exit option available if unitholders prefer not to remain invested in the consolidated scheme
  • Fund size and composition will change post-merger

Market Operations:

  • Consolidation reduces number of mutual fund schemes in Tata Mutual Fund lineup
  • Improved operational efficiency through scheme rationalization
  • BSE StAR MF platform will reflect the merged scheme structure from effective date

Impact Justification

Mandatory scheme merger affecting all unitholders of Tata Equity Savings Fund with suspension of new investments and automatic migration to Tata Balanced Advantage Fund