Groww Mutual Fund launches Nifty Private Bank ETF; NFO opens today

Groww Mutual Fund has announced the launch of the Groww Nifty Private Bank ETF, a passive investment scheme designed to track the performance of the Nifty Private Bank Index – Total Return Index (TRI), subject to tracking error. 

The new fund offer (NFO) for the open-ended exchange-traded fund will be available from May 6 (Wednesday) to May 20. The ETF aims to provide investors with a transparent, rules-based avenue to gain exposure to India’s private banking segment. 

Private banks gain ground 

Private sector banks have steadily strengthened their position within India’s financial system, supported by improved fundamentals, operational efficiencies, and changing customer preferences. Over the past decade, their share in total deposits has risen from around 21% to nearly 38%, reflecting sustained competitive gains. 

Recent data points to continued expansion across key financial metrics. Deposits have grown by about 76% over the past five years, while advances have risen by roughly 85%, indicating strong business momentum and customer acquisition. 

Asset quality has also improved, with both gross and net non-performing assets (NPAs) declining over time, suggesting greater resilience across economic cycles. Profitability indicators such as return on equity (ROE) and return on assets (ROA) have remained healthy, aided by better asset quality. 

The Nifty Private Bank Index is designed to track the performance of leading private sector banks that are integral to India’s banking ecosystem. The index comprises 10 private banks selected based on liquidity, market capitalisation, and other eligibility criteria, and follows a free-float market capitalisation-weighted methodology. 

The ETF launch comes amid growing investor interest in passive investment products that offer targeted exposure to specific sectors of the economy.