One scheme no longer fits all: Sebi plans split routine as funds bulk up 7x

Watchdog flexes clone-and-cap fix as AUM bloat strains category limits

Actively managed mutual fund schemes with assets over ₹50,000 crore have jumped from just two in March 2023 to 14 by June 2025 — a sevenfold leap.

 

Powering this growth are buoyant equity markets and a steady stream of fresh inflows. Parag Parikh Flexi Cap and HDFC Balanced Advantage (BAF) now sit above the ₹1 trillion mark.

 

In March 2023, only two schemes — HDFC BAF and SBI Equity Hybrid — had assets under management (AUM) of ₹50,000 crore.

 

That ‘mega’ club is likely to swell further, with several more funds closing in on the ₹50,000 crore AUM line. As of June 2025, six other schemes had AUMs north of ₹40,000 crore. 

 

The ballooning size of these mega schemes has nudged the Securities and Exchange Board of India (Sebi) to ease its ‘one scheme per category’ rule. On Friday, the market regulator proposed that once a fund crosses the ₹50,000 crore AUM threshold, it can be soft-closed — allowing a second, similar scheme to be launched under the same category, subject to a cap on expenses.

 

Sebi’s proposal acknowledges a practical challenge: the larger a fund becomes, the harder it is to trade mid and smallcap stocks without moving the market.