India notifies new portfolio-manager rulebook for April 2027, splitting full PMS and PRIM capital tests

SEBI’s 2026 Portfolio Managers Regulations take effect on 1 April 2027. The official Gazette text, posted by SEBI on 12 October, creates a distinct Portfolio Management Service Route for Investment in Mutual Fund units, known as PRIM, alongside the wider portfolio-management framework.[1][2]

PRIM is restricted to the specified mutual-fund route, including direct plans, ETFs and the permitted fund categories. Existing ordinary managers receive 12 months to comply with the liquid-resource requirement. Ten per cent of the capital floors equals ₹50 lakh for an ordinary manager and ₹20 lakh for a PRIM-only manager.[2]

The investment limits require exact reading

Regulation 17(1)(d) allows unlisted investments subject to limits and conditions specified by SEBI. It does not itself impose the 10% unlisted-debt cap attributed to it in an earlier version of this article. That unsupported limit has been removed.[2]

The distinction matters commercially. A manager choosing the lower-capital route also accepts a narrower investment perimeter; it cannot use PRIM registration as a general discretionary-management permission. Similarly, a threshold in the regulations and a later operational limit serve different purposes and should not be merged into one eligibility claim.[2]

For implementation, firms need to map their registration category, existing client mandates and permitted investments to the rules applicable at commencement. The April 2027 start date leaves this as a transition task on 27 October 2026, rather than a description of an already-operative replacement regime.[2]

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