Description

HSBC Mutual Fund is merging its Global Equity Climate Change Fund of Fund (merging scheme) into HSBC Global Emerging Markets Fund (surviving scheme), effective after business hours on March 25, 2026. Investors may exit without load between February 23, 2025 and March 24, 2026.

Summary

NSE has informed its members that HSBC Mutual Fund will merge the HSBC Global Equity Climate Change Fund of Fund (merging scheme) into HSBC Global Emerging Markets Fund (surviving scheme). The merger is SEBI-approved and will become effective after business hours on March 25, 2026. Investors who do not wish to participate in the merger may redeem or switch to other eligible HSBC Mutual Fund schemes without incurring an exit load during the specified exit window.

Key Points

  • HSBC Global Equity Climate Change Fund of Fund (merging scheme) will be merged into HSBC Global Emerging Markets Fund (surviving scheme)
  • The merger constitutes a change in the fundamental attributes of the merging scheme under Regulation 18(15A) of SEBI (Mutual Funds) Regulations, 1996
  • SEBI granted no-objection to the merger vide communication dated February 12, 2026
  • The surviving scheme’s name, investment objective, asset allocation, expense structure, and other attributes remain unchanged post-merger
  • No new scheme will come into existence as a result of the merger
  • Existing SIP/XSIP/SWP registrations in the merging scheme will continue to be processed during the exit load-free period
  • After business hours on March 25, 2026, SIP/XSIP/STP/SWP registrations will be automatically shifted to the surviving scheme
  • An exit option (without exit load) is available to unitholders of both the merging and surviving schemes

Regulatory Changes

  • The merger is governed by Regulation 18(15A) of the SEBI (Mutual Funds) Regulations, 1996, which mandates investor exit options when fundamental attributes of a scheme change
  • SEBI approval was received on February 12, 2026
  • The merging scheme ceases to exist after March 25, 2026

Compliance Requirements

  • NSE members are required to take note of this merger and communicate the relevant details to investors on the NSE MF Invest platform
  • Investors in the merging scheme who do not favour the merger must redeem or switch their investments before March 24, 2026 to avail of the exit load waiver
  • Members must ensure SIP/XSIP/STP/SWP instructions are managed appropriately; these will auto-migrate to the surviving scheme after March 25, 2026

Important Dates

  • February 12, 2026: SEBI granted no-objection to the merger
  • February 20, 2026: NSE circular issued to members
  • February 23, 2025 – March 24, 2026 (both days inclusive): Exit load-free redemption/switch window for investors not in favour of the merger
  • March 25, 2026 (after business hours): Merger effective date; merging scheme ceases to exist; SIP/XSIP/STP/SWP registrations migrated to surviving scheme

Impact Assessment

This merger primarily affects existing unitholders of the HSBC Global Equity Climate Change Fund of Fund. Investors have a window to exit or switch without exit load penalties. Those remaining will be transitioned into the HSBC Global Emerging Markets Fund, which has a different investment focus (broad emerging markets vs. climate change-themed global equities). This represents a meaningful change in investment mandate for affected unitholders. NSE MF Invest platform members need to ensure investor awareness and proper processing of instructions during and after the exit window. Systemic market impact is limited, as this is a fund-level operational change with no direct bearing on exchange-listed securities.

Impact Justification

Affects existing unitholders of HSBC Global Equity Climate Change Fund of Fund who must decide to stay, switch, or redeem before March 25, 2026. No broad market impact, but operationally significant for affected investors and NSE MF platform members.