PMS minimum investment: the ₹50 lakh rule

Say a client in Chennai holds ₹50 lakh of listed shares and wants them managed rather than sold. The shares are transferred from her verified demat account into the PMS demat account in her name. Their value counts toward the ₹50 lakh. The manager can then keep, sell or rebalance them under the investment approach she chose.

Two practical points for the distributor. First, the manager decides whether the shares fit its approach; it may sell many of them, and each sale is the client's own taxable transaction. Second, check the manager's Disclosure Document for how it handles securities brought in, since the rule allows securities but each manager sets its own process.

Expect a direct question (minimum amount: ₹50 lakh), a true/false on the market fall case (false that a top-up is required), and a scenario where a client offers less than ₹50 lakh now and more later (the manager declines). A newer pattern names an accredited investor and asks whether the minimum applies; it does not, provided the Disclosure Document and agreement cover it.