PPFAS Mutual Fund stops new entries in the flexi cap fund

PPFAS Mutual Fund has stopped accepting inflows into PPFAS Flexicap Fund with effect from February 2, 2022. The move comes after the Securities and Exchange Board of India ordered mutual fund companies to stop taking new subscriptions in programs investing in foreign equities. The notice was sent by Sebi after India’s mutual fund industry breached the mandatory $7 billion limit for outbound investment.

“Investors are hereby informed that, as advised by SEBI in accordance with the email dated January 28, 2022 and AMFI’s clarification dated January 30, 2022, in order to avoid non-compliance with overseas industry-wide limits, as authorized by the RBI and pursuant to the SEBI Circular dated 03 June 2021, PPFAS Asset Management Private Limited and PPFAS Trustee Company Private Limited, the trustees of PPFAS Mutual Fund have decided to temporarily suspend the transactions mentioned below under the scheme, Parag Parikh Flexi Cap Fund (Designated Scheme) effective February 02, 2022,” PPFAS MF said in a notice to investors.

Transactions in the PPFAS Flexi Cap Fund, received after the deadline of February 1, 2022 will not be accepted and processed. The fund house has clarified that lump-sum subscription to the program, new systematic registration (including the systematic transfer plan in the designated program) will not be accepted from February 2, 2022. However, existing SIP / STP installments will will continue.

PPFAS Flexicap Fund invests up to 35% of its corpus in foreign stocks, primarily stocks of US technology companies. Eralier, other fund companies such as Motilal Oswal Mutual Fund have also stopped lump sums in their investment programs outside India. In a circular dated January 13, Motilal Oswal AMC announced the suspension of lump-sum investments and the transfer (from other funds) to the Motilal Oswal Nasdaq 100 fund of funds, the Motilal Oswal S&P 500 Index fund and the Motilal Oswal MSCI EAFE Top 100 Index. . The asset management firm (AMC) said it had taken action after it approached the market regulator’s global investment limit of $1 billion in foreign equities.

Dolores W. Simon