The Securities and Exchange Board of India (SEBI) has issued detailed modalities for migration of existing Alternative Investment Fund (AIF) schemes into Accredited Investor-only (AI-only) schemes or Large Value Funds (LVFs), following amendments to the AIF Regulations notified on November 19, 2025.
The circular allows eligible AIFs or schemes to convert to AI-only or LVF structures “subject to obtaining positive consent from all the investors and meeting the respective conditions.”
Managers of converting schemes must change the scheme name to include ‘AI only fund’ or ‘LVF’, report the conversion to SEBI at aifreporting@sebi.gov.in within 15 days, and notify depositories for system updates within 15 days of conversion.
“If an investor is an AI at the time of on-boarding into an AIF scheme, he/ she shall be reckoned as an AI through the life of the scheme, even if he/ she were to lose such status in the interim,” SEBI said in a circular on Monday.
The regulator has also capped the maximum extension permissible for AI-only schemes at five years, inclusive of any extension granted before conversion.
SEBI also exempted LVFs from following the standard template of the placement memorandum and the annual audit of placement-memorandum terms, without requiring specific waivers from investors. The exemption has been inserted into the Master Circular for AIFs.
Trustees and sponsors must ensure that the manager’s Compliance Test Report includes adherence to the provisions introduced through this circular
Published on December 8, 2025
