Groww receives SEBI approval to launch Nifty non-cyclical consumer index fund

• Groww has received SEBI approval to launch the Nifty Non-Cyclical Consumer Index Fund.
• The Nifty Non-Cyclical Consumer Index Fund will be launched through an NFO.
• The Nifty Non-Cyclical Consumer Index Fund is expected to be launched in the first week of May.

Financial services company Groww has received approval from the Securities Exchange Board of India (SEBI), the country’s securities market regulator to launch the Nifty Non-Cyclical Consumer Index Fund through a new fund offering (NFO).

This will be the country’s first non-cyclical index fund and is expected to go live in the first week of May. The minimum investment amount for the NFO will be ₹500 and in multiples of ₹1 for purchases and ₹0.1 for switching.

The redemption amount has been set at a minimum of ₹500 and in multiples of ₹1 thereafter.

“The investment goal of the Nifty Non-Cyclical Consumer Index Fund is to generate long-term capital growth by investing in securities of the Nifty Non-Cyclical Consumer Index (TRI) in the same proportion/weightage to offer returns before expenses that track the total return of the Nifty Non-Cyclical Consumer Index, subject to tracking errors,” Groww said in a statement.

Groww acquired the mutual fund business of Indiabulls Housing Finance last year for ₹175.6 crore.

What is a non-cyclical consumer index fund?

A non-cyclical consumer index fund focuses on companies that provide essential goods and services which tend to remain stable in demand regardless of the economic cycle. This type of fund is designed to protect against market volatility by investing in stocks from industries such as utilities, healthcare, consumer staples, and sometimes financials.

In this instance, the fund is benchmarked against the Nifty Non-Cyclical Consumer Index (Total Return Index). This tracks the performance of the top 30 stocks under sectors such as consumer goods and services, telecom and more.

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