Groww gets SEBI nod for launching index fund
The development comes days after its competitor in the broking space, Zerodha, announced the launch of its mutual fund schemes under its mutual fund business, Zerodha Asset Management Ltd.
Online discount broking and investment platform has received the Securities and Exchange Board of India's (SEBI) nod to launch its index fund—Groww Nifty Total Markets Index Fund.
“Groww Mutual Fund got approval for its first NFO - Groww Nifty Total Market Index Fund,” Co-founder Lalit Keshre shared on X, formerly known as Twitter.
Index funds are defined as passive mutual funds that track and attempt to replicate the performance of popular market indices.
The Tiger Global and Sequoia-backed firm plans to launch the same via a new fund offering (NFO). NFO is a first-time subscription offer by Asset Management companies to launch a new category of fund. Similar to an IPO in the stock market, NFOs are intended to raise capital for the fund and attract investors.
The announcement comes three days after its competitor in the broking space, announced the launch of its mutual fund schemes under its mutual fund business, Zerodha Asset Management Ltd.
The company formed a joint venture (JV) with the wealth management platform Smallcase for the new fund house, which will launch a mix of index funds as well as Exchange-Traded Funds (ETF).
Nextbillion Technology, which runs Groww, acquired the mutual fund business of Indiabulls Housing Finance (IBHFL) for Rs 175.6 crore after receiving the necessary approvals in May, giving it the head-start to launch its own AMC business.
Groww has raised $393 million so far and was last valued at $3 billion after raising $251 million in October 2021 in a round led by ICONIQ Growth.
Edited by Affirunisa Kankudti