NISM Category I and II Alternative Investment Fund Managers Book by National Institute of Securities Markets

Category I and II Alternative Investment Funds Managers Workbook builds foundational clarity on the investment landscape and alternative assets, then advances into the full AIF lifecycle—fund structuring, governance, valuation, monitoring/reporting, taxation, and the SEBI/FEMA/PMLA regulatory environment—so readers develop the precise knowledge, judgment, and compliance mindset expected of AIF managers and their investment teams.

This book is intended for the following audience:

• Category I & II AIF Managers and their key investment team members
• Operations, Compliance, Risk, and Reporting Professionals in AIFs, trusteeships, administrators, and custodians
• Valuation Analysts, Consultants, Lawyers, Accountants and other service providers to AIFs
• Students and Job Aspirants pursuing careers in private markets and preparing for the NISM-Series-XIX-D examination

The Present Publication is the April 2025 Workbook Version. It is developed in collaboration with the Certification Team of NISM, Archit Lohia, Pratap Giri and Dr Rachana Baid and reviewed by Biharilal Deora. It is published exclusively by Taxmann, with the following noteworthy features:

• [Exam-aligned Content] Maps closely to the XIX-D syllabus and weightages; includes MCQs and caselets for realistic practice
• [Lifecycle Coverage] From fund design and investor documentation to valuation policy, performance benchmarking, reporting, exits, and winding-up
• [Governance & Conduct] Clear treatment of conflict management, code of conduct, co-investments, and industry best practices
• [Performance & Benchmarking] Practical return measures (pre/post-tax), hurdle, high-water mark, and benchmarking frameworks with worked examples
• [Valuation Depth] Equity, debt, business, asset-based, DCF, and multiples; role of registered valuers; NAV and fund valuation approach
• [Regulatory Understanding] SEBI (AIF) Regulations 2012 and related frameworks (FEMA, PMLA, SEBI PIT, PFUTP, ICDR, FATCA/CRS), including registration, eligibility, investment conditions, obligations, disclosures, surveillance
• [Clarity and Pedagogy] Lucid explanations, annexures, a glossary, and chapter organisation that support quick revision

The coverage of the book is as follows:

• Section A – Basics of Investments
  • Investment objectives, required return, and the role of alternative assets alongside traditional instruments
• Section B – Understanding the AIF Ecosystem
  • Evolution and growth of AIFs in India; category comparisons and suitability
  • Fund structuring and pooling, trust/LLP/company forms, fee structures (management fees, hurdle, HWM)
  • Performance & Benchmarking – Risk types, return measures, benchmarking agencies, and a worked case
  • Legal Documentation & Negotiations – PPM, trust/LLP/company constitutions, IMA, subscription agreements, wrappers, and support agreements
• Section C – Managing AIF Investments (Category I & II)
  • Investment strategies and deployment approaches
  • Deal sourcing, due diligence, definitive agreements, and investor protection rights
  • Governance, conflict management, human capital, co-investments, codes of conduct, and best practices
  • Valuation of portfolio companies and funds; NAV, regulations, and third-party valuer roles
  • Monitoring, reporting, exits (including secondary processes), winding-up, liquidation schemes, and dissolution period
• Section D – Taxation & Regulatory Framework
  • Pass-through, set-off/carry-forward, GAAR, MLI, and other applicable taxes with illustrations
  • SEBI (AIF) Regulations 2012 – Registration, sponsor/manager commitment, investor on-boarding, demat of units, investment conditions, obligations, inspections, periodic disclosures, due diligence
  • FEMA – Foreign participation in AIFs and overseas investments by AIFs
  • PMLA and other SEBI regulations relevant to AIF operations; FATCA/CRS reporting

The structure of the book is as follows:

• Logical Four-part Flow – Concepts → Ecosystem & Structures → Investment Management (Cat I/II) → Tax & Regulations
• Chapter-wise Learning Path with annexures (e.g., benchmarking and documentation) and a comprehensive glossary for last-mile revision
• Assessment Blueprint alignment ensures study time is allocated where marks concentrate