Securities and Exchange Board of India (SEBI) Proposes Overhaul of Portfolio Management Services Norms

Key facts

• The Securities and Exchange Board of India (SEBI) has proposed a comprehensive review of the SEBI (Portfolio Managers) Regulations, 2020.
• Assets under management (AUM) of the PMS industry more than doubled to ₹42.61 lakh crore as of May 2026 from ₹18.07 lakh crore in April 2019.
• The number of portfolio managers rose from 226 in 2020 to 515 as of May 31, 2026.
• SEBI proposed a new ‘mutual fund-only’ PMS category with a reduced minimum client investment of ₹25 lakh (from ₹50 lakh) and a reduced minimum net worth of ₹2 crore (from ₹5 crore).
• Portfolio managers under the proposed framework may invest in overseas listed equity and debt securities, to-be-listed securities, and up to 10% of client AUM in investment-grade unlisted debt securities.
• SEBI proposed allowing derivatives exposure up to 1.25 times the client’s assets under management for hedging and investment strategies.
• Firms managing assets below ₹100 crore may be exempted from maintaining a separate dealing room under the proposed ease in infrastructure requirements.