Groww Mutual Fund has launched the Groww Gilt Fund, an open-ended debt scheme that invests primarily in government securities. The New Fund Offer (NFO) opens on April 23, 2025, and closes on May 7, 2025.
The fund will allocate at least 80% of its assets to government securities across maturities. It aims to offer investors a low-risk, government-backed investment option, especially suited for portfolio diversification.
Why government securities now?
Changing economic indicators may support the case for sovereign debt investments:
- Interest rate adjustments due to slowing economic activity could make fixed-income options like government securities more attractive.
- A weakening Chinese Yuan may reduce import-led inflation in India, supporting debt market stability.
- India’s improving current account deficit (CAD) may lower risk premiums on government debt.
- Potential foreign institutional investor (FII) inflows into Indian debt markets could drive demand for gilts.
- With moderating inflation and stable energy prices, government bonds may offer better relative returns.
Key features of the Groww Gilt Fund:
- Sovereign-backed investment: Primarily invests in Indian government securities, offering safety and stability.
- Portfolio diversification: Aims to reduce risk during market uncertainty.
- Liquidity: Offers flexibility to enter or exit due to the liquid nature of government securities.
- Long-term outlook: May benefit from economic adjustments and improving fiscal conditions.
Groww Mutual Fund sees this launch as an opportunity for investors to access government debt in a structured and professionally managed manner.
