Groww Mutual Fund receives SEBI nod for launching its first index fund

Groww launches new index fund

Online stock broking firm Groww on Thursday announced that the firm has received Securities and Exchange Board of India (SEBI) approval to launch its first index fund, Groww Nifty Total Markets Index Fund through new fund offering (NFO).

"Groww Mutual Fund got approval for its first NFO - Groww Nifty Total Market Index Fund," Wrote Groww's cofounder Lalit Keshre on Twitter.

A new fund offer (NFO) is the first subscription offering for any new fund offered by an investment company. As per media reports Groww Mutual Fund submitted draft documents with the SEBI on Tuesday for the launch of its index fund.

The move comes just three days after online stock broking firm Zerodha announced the launch of its  two new schemes Zerodha Tax Saver (ELSS) Nifty Large Midcap 250 Index Fund and Zerodha Nifty Large Midcap 250 Index Fund (ZN250) under its mutual fund business, Zerodha Asset Management Ltd.

Groww got the approval of the Competition Commission of India (CCI) in September 2021 to acquire Indiabulls Asset Management Company (AMC) and Indiabulls Trustee Company.

In May 2023, Groww acquired 100 percent stake in the mutual fund business of Indiabulls Housing Finance for ₹175.62 in an all-cash deal.

In June 2023, SEBI issued a circular on regulations for online platforms like Paytm, Zerodha and Groww that offer transactions in direct plans for mutual fund schemes, which it calls execution-only platforms or EOPs.

The circular was for mutual funds to allow for the segregation of schemes into two types — direct and regular.