Description

HDFC Arbitrage Fund Retail Plan and Wholesale Plan will merge into HDFC Arbitrage Fund Wholesale Plan Monthly IDCW effective May 22, 2026. Investors may exit without load between April 22 and May 21, 2026.

Summary

NSE has informed its members that HDFC Arbitrage Fund Retail Plan and Wholesale Plan (merging schemes) will be merged into HDFC Arbitrage Fund Wholesale Plan Monthly IDCW (surviving scheme) effective after close of business hours on May 22, 2026. This merger also involves consolidation of Normal IDCW Options into Monthly IDCW Options under the Wholesale Plan, and renaming of surviving plans/options.

Key Points

  • HDFC Arbitrage Fund Retail Plan and Wholesale Plan will merge into HDFC Arbitrage Fund Wholesale Plan Monthly IDCW on May 22, 2026.
  • Normal Income Distribution cum Capital Withdrawal (IDCW) Options will merge into Monthly IDCW Options under the Wholesale Plan.
  • Surviving plans/options will be renamed post-merger.
  • Investors who object to the merger can redeem or switch to other HDFC MF schemes without exit load during the exit window.
  • Existing SIP/XSIP/SWP will continue to be processed in merging schemes during the exit load-free period.
  • After close of business on May 22, 2026, merging schemes cease to exist; SIP/XSIP/STP/SWP registrations shift to surviving schemes.
  • The Retail Plan had been closed to new investments since March 26, 2014, in line with SEBI Master Circular Clause 3.3 (single plan per scheme).
  • AAUM of the scheme stands at ₹24,459 crores for the quarter ended March 2026; Retail Plan represents only 0.02% of AAUM.

Regulatory Changes

The merger is in compliance with SEBI Master Circular for Mutual Funds (Clause 3.3), which mandates offering a single plan under a scheme. The consolidation aligns the fund structure with SEBI’s single-plan framework that has been in force since March 2014.

Compliance Requirements

  • NSE members on the NMF TM Segment must take note of the merger and communicate relevant information to clients invested in HDFC Arbitrage Fund.
  • Investors wishing to exit must do so through the NSE MF Invest platform during the exit load-free window.
  • Existing SIP/XSIP/STP/SWP instructions will automatically migrate to the surviving scheme post-merger; no separate action required by investors who wish to continue.

Important Dates

  • April 22, 2026: Start of exit load-free redemption/switch window.
  • May 21, 2026 (up to 3:00 PM): Last day/time for exit load-free redemption or switch.
  • May 22, 2026 (close of business): Effective date of merger; merging schemes cease to exist; SIP/XSIP/STP/SWP registrations shift to surviving scheme.

Impact Assessment

The merger has a moderate operational impact on investors holding units in HDFC Arbitrage Fund Retail Plan or Normal IDCW Options under the Wholesale Plan. Given the Retail Plan’s negligible AUM (0.02% of total), the financial impact is limited. Investors who prefer to remain invested need take no action as their holdings and systematic plans will automatically migrate. The primary consideration is the exit window for dissenting investors, which runs from April 22 to May 21, 2026. NSE MF Invest platform operations will be updated to reflect the merged scheme structure after May 22, 2026.

Impact Justification

Affects existing investors in HDFC Arbitrage Fund Retail and Wholesale Plans with a defined exit window; operational impact limited to NSE MF Invest platform participants and HDFC MF investors.