Groww Gets SEBI Nod To Launch New Nifty Fund

SUMMARY

Launched under the aegis of AMC Groww Mutual Fund, the NFO will likely go live in the first week of May

The fintech unicorn said that it will be an open‐ended scheme that will be benchmarked against the Nifty Non-Cyclical Consumer Index (Total Return Index)

Groww’s parent Billionbrains Garage turned profitable in FY23 with a net profit of INR 448.7 Cr as against a net loss of INR 239 Cr in the FY22

Fintech unicorn growow has received Securities and Exchange Board of India’s (SEBI) nod to launch India’s first Nifty non-cyclical consumer index fund.

Launched by the platform’s asset management company (AMC) Groww Mutual Fund, the new fund offering (NFO) will likely go live in the first week of May. In a statement, the company said it will be an open‐ended scheme that will be benchmarked against the Nifty Non-Cyclical Consumer Index (Total Return Index).

For the uninitiated, the Index tracks the performance of 30 largest stocks under the non-cyclical consumer theme across sectors such as consumer goods and services, telecom, media and entertainment, among others.

The fresh development comes seven months after the fintech unicorn received approval from the market regulator to launch its maiden index fund. This paved the way for the entry of the stockbroking platform’s entry into the mutual fund space last year.

Last year, Groww acquired the mutual fund business of Indiabulls Housing Finance for a total of INR 175.6 Cr, which set the stage for the fintech’s AMC business.

Groww’s latest NFO comes close on the heels of reports that its competitor Zerodha was in talks with several investors to raise up to $100 Mn for its AMC arm Zerodha Fund House. The Nithin Kamath-led company also debuted its maiden three mutual fund schemes in October 2023.

Founded in 2017 by ex-Flipkart employees Lalit Keshre, Harsh Jain, Neeraj Singh, and Ishan Bansal, Groww operates an online stockbroking platform and also offers direct mutual funds. It competes with the likes of Zerodha, ETMoney and StockGro, among others.

The latest launch comes as Groww has been rapidly fueling fueling its “Super App” ambitions by focussing on diversifying its product portfolio. From offering instant personal loans to UPI payments, the company has shored up its product mix in the past one year.

Groww’s parent Billionbrains Garage turned profitable in the financial year 2022-23 (FY23) and reported a net profit of INR 448.7 Cr as against a net loss of a whopping INR 239 Cr in the previous fiscal year.

However, operating revenue more than tripled year-on-year (YoY) to INR 1,277.8 Cr in FY23.

Groww’s new NFO comes as Jio Financial Services, in partnership with the world’s biggest asset manager BlackRock, have set aside $300 Mn to disrupt the India’s $540 Bn mutual fund industry.