Description

NSE suspends fresh subscriptions, SIP registrations, STP and switch-in transactions for Sundaram Global Brand Theme-Equity Active FOF effective January 1, 2026 to avoid breach of RBI overseas investment limits.

Summary

NSE has temporarily suspended fresh subscriptions in Sundaram Global Brand Theme-Equity Active Fund of Fund on the NSE MF Invest Platform effective January 1, 2026. The suspension is implemented to avoid breach of industry-wide overseas investment limits set by RBI, as the fund invests 95% of its assets in overseas securities (Sundaram Global Brand Fund, Singapore). Redemptions, existing SIPs, and withdrawals remain operational.

Key Points

  • Lumpsum subscriptions disabled effective January 1, 2026
  • Fresh SIP, STP, and Switch-in registrations blocked from January 1, 2026
  • Existing SIP/STP instalments will continue as scheduled
  • No restrictions on redemptions, SWP, switch-out, and STP-out transactions
  • Applications received after cut-off time of December 31, 2025 will not be processed
  • Suspension is temporary in nature pending compliance with RBI overseas limits
  • Intra-scheme and intra-plan switches remain unchanged
  • Investments by designated employees as per SEBI guidelines continue normally

Regulatory Changes

This action is taken 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
  • Compliance with RBI overseas investment limits for mutual funds

The Trustees of Sundaram Mutual Fund decided to implement this temporary suspension to ensure the fund does not breach industry-wide overseas limits allowed by RBI.

Compliance Requirements

For NSE Members:

  • Disable lumpsum subscriptions for the designated scheme from January 1, 2026
  • Block fresh SIP, STP, and switch-in registrations from January 1, 2026
  • Reject any applications received after December 31, 2025 cut-off time
  • Ensure existing SIP/STP instalments continue processing
  • Maintain normal operations for redemptions and withdrawal plans

For Investors:

  • Cannot make fresh lumpsum investments from January 1, 2026
  • Cannot register new SIPs, STPs, or switches into the fund
  • Existing SIP/STP commitments will honor scheduled instalments
  • Full flexibility for redemptions and exits remains available

Important Dates

  • December 31, 2025: Cut-off time for accepting lumpsum and switch-in applications
  • January 1, 2026: Effective date for suspension of fresh subscriptions, SIP registrations, STP, and switch-in transactions
  • Duration: Until further notice (temporary suspension)

Impact Assessment

Investor Impact:

  • Existing unitholders can continue their systematic investments and redeem without restrictions
  • New investors cannot enter the fund through any route until suspension is lifted
  • Existing investment values and returns remain unaffected

Market Impact:

  • Limited to specific fund scheme; no broader market implications
  • Reflects RBI’s overseas investment limit constraints affecting international fund-of-funds
  • Similar suspensions may be expected for other overseas-investing schemes approaching RBI limits

Operational Impact:

  • Fund house must manage existing AUM without fresh inflows
  • May affect fund’s growth trajectory during suspension period
  • Demonstrates regulatory compliance and prudent risk management

Impact Justification

Affects investors in a specific mutual fund scheme but does not impact broader market operations. Existing investments continue normally with only new subscriptions temporarily blocked.