The market regulator, the Securities and Exchange Board of India (Sebi), has set the deadline for Alternative Investment Funds (AIFs) to submit their Net Asset Value (NAV) for each ISIN of AIF units to depositories
The NAV must be uploaded through Registrars and Transfer Agents (RTAs) by 1 May 2026 or within 30 days of the valuation date of the investment portfolio, whichever is later.
The valuation date will be the date of the valuation report when an independent valuer is appointed. If the valuation is conducted by internal valuers, then the date on which the valuation is documented in the internal records of the fund will be considered.
The manager of the AIF shall be responsible to ensure that NAV details are reported accurately and on time.
Through the latest move, the Sebi seeks to enhance transparency and operational efficiency, and to facilitate system readiness of AIFs, registrars, transfer agents and depositories.
What should depositories know?
The market regulator has instructed depositories to develop the necessary infrastructure to enable RTAs to upload NAVs and ensure their display within the depository system.
In places where AIF NAVs are displayed, depositories must carry a disclaimer which says, “Net Asset Value (NAV) being shown is on the basis of valuation methodology and accounting practice followed by your respective AIF. Please refer to your fund documents for more details.”
AIF norms
According to the current framework, AIFs are permitted to raise funds from Indian, foreign, and non-resident Indian investors through the issuance of units, the value of which is determined by the valuation of the AIF’s investment portfolio.
Category I and Category II AIFs must conduct an investment valuation at least once every six months by an independent valuer. However, this period can be extended to one year with the approval of at least 75% of investors on the basis of the value of their investments in the AIF.
Meanwhile, Category III AIFs are required to ensure that NAV is calculated independently of the fund management function. Investors must be provided with the NAV at least once every quarter for closed-ended funds and at least once every month for open-ended funds.
