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Alternative Investment Fund


Dear Reader,

This memorandum is meticulously crafted with the primary goal of offering a comprehensive overview of the distinctive characteristics that define the various categories within the domain of Alternative Investment Funds (AIFs). AIFs, by their inherent nature, operate within a dynamic and ever-evolving financial landscape. As such, this memorandum is devoted to equipping you with an insightful guide that delves deep into the fundamental features of diverse AIF categories. It is tailored specifically for individuals who aspire to broaden their knowledge and understanding of these investment instruments.

To facilitate a clearer understanding, we have presented the comparative information in a tabular format:

AIF - Key Pointers

Private & Confidential | Not for Circulation | Reliance Restricted


Sr. No.

#

AIF - I

AIF - II

AIF - III

1

Category of Fund

I

II

III

2

SEBI Application Fees

1,00,000

1,00,000

1,00,000

3

SEBI Registration Fees

5,00,000

10,00,000

15,00,000

4

SEBI per Scheme Fees

1,00,000

1,00,000

1,00,000

5

Permitted Investors:

a.

Indian

b.

Foreign

c.

Non-resident Indian

6

Corpus per Scheme

20Crs

20Crs

20Crs

7

Minimum Investment Per Investor

1Cr

1Cr

1Cr

8

Minimum Investment Per Employees/Directors of AIF

25Lacs

25Lacs

25Lacs

9

Minimum Investment Per Employees/Directors of Manager Entity

25Lacs

25Lacs

25Lacs

10

Minimum Contribution - Continuing Interest of Manager or Sponsor:

a

% to Total Corpus

2.50%

2.50%

2.50%

b

Cap

5Crs

5Crs

5Crs

11

Maximum Number of Investor Per Scheme

Except in case of Companies - for which limit as per Companies Act, 2013 will apply i.e. 200 per Scheme

1000

1000

1000

12

Filing of PPM with SEBI through Merchant Banker

Yes

Yes

Yes

13

Close/Open ended

Close-ended

Close-ended

Close/Open-Ended

14

Minimum Tenure of Fund

3 Years

3 Years

3 Years


Sr. No.

#

AIF - I

AIF - II

AIF - III

15

Minimum Tenure of Scheme

3 Years

3 Years

3 Years

16

Listing on Stock Exchange

Permitted

Permitted

Permitted for Close-eneded

17

Minimum tradeable lot on Stock Exchange

1Cr

1Cr

1Cr

18

Investment in Foreign Company

19

Co-investment:

a

Co-investment with more favourable terms compared to AIF

X

X

X

b.

Co-investment with variable Exit terms compared to AIF

X

X

X

20

Limit on investing of Investable Funds:

a

Maximum % of total Investable Funds in One Investee entity (directly or indirectly)

25%

25%

10%

b

For Large Value Fund - Accredited Investors - Maximum % of total Investable Funds in One Investee entity (directly or indirectly)

50%

50%

20%

21

Permitted category of Investments: *

a

Venture Capital Undertakings

X

b

Special Purpose Vehicles

X

c

Units of AIF-I

d

Units of AIF-II

e

Units of AIF-III

X

X

f

Hedging

g

Credit default swaps

h

Unlisted Companies


Sr. No.

#

AIF - I

AIF - II

AIF - III

i

Market Making

X

j

SME Company - Lock-in of 1 year

X

k

Derivates

X

X

l

Complex/Structured Products

X

X

m

Deal in physical goods received in Settlement of investment/transaction

X

X

22

Borrowing, except on temporary basis

X

X

23

Appointment of Custodian:

a

Corpus 500crs or more

b

Irrespective of corpus

X

X

24

Appointment of Complaince Officer

25

Report to Unitholders

Half-yearly

Half-yearly

Quarterly

26

Valuation of Investments

Half-yearly

Half-yearly

Quarterly-Close Ended

Monthly-Open Ended


* Subject to change


It is of utmost importance to clarify that the intention behind this memorandum is strictly educational, and it should not be interpreted as a solicitation or recommendation or advice. The contents are designed to serve as an informative resource to enhance the readers' comprehension of AIFs. It is vital to underscore that the information contained herein does not serve as a substitute for personalized advice.

For the most up-to-date regulatory information and developments, our primary source is the Securities and Exchange Board of India (SEBI), ensuring that the information provided herein is current as of August 18, 2023.

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