Groww Silver ETF has announced a 10:1 stock split effective February 6, 2026, reducing the face value from ₹10 to ₹1 per share while maintaining the same total investment value. The split mechanism works by dividing existing shares into smaller units based on the reduced face value of ₹1, ensuring that the total value of holdings remains unchanged. For example, if you owned one ETF unit worth ₹1,000 before the split, you will receive 10 ETF units, each worth around ₹100, maintaining your ₹1,000 total investment. The split shares will be automatically credited to Choice Demat accounts with no investor action required, though new shares may take up to two working days to appear after the record date.
ETF splits enable investors to build diversified portfolios with smaller capital requirements. As reported by Mint, suppose you want to invest ₹4,000 monthly across multiple ETFs and each unit costs ₹2,000, making it difficult to invest in all four ETFs. After a split reduces unit prices to ₹200, you can easily spread investments across multiple ETFs. Most recently, the DSP Nifty Midcap 150 Quality 50 ETF and DSP Nifty Healthcare ETF underwent a 10:1 split effective July 3, 2026. In February 2026, Kotak Mutual Fund split five ETFs including Bank, Consumption, Silver, Value 20, and Midcap 150 ETF. Earlier splits included Kotak Gold ETF, ICICI Prudential Nifty 100 ETF, Nippon India ETF Nifty 50 BeES, and Nippon India Gold BeES. The Groww Silver ETF split follows this trend, improving share liquidity and affordability for investors.
ETF splits do not trigger tax liability as they do not create profit at the time of the split. According to DSP Mutual Fund FAQs cited by Mint, if you bought 100 ETF units at ₹100 per unit and the ETF undergoes a 2:1 split, you will own 200 units worth ₹50 each, but your investment value remains ₹10,000. Tax is payable only when you sell ETF units, not during the split process. If you sell all 200 units at ₹80 per unit, the sale value is ₹16,000 minus total purchase cost of ₹10,000, resulting in capital gains of ₹6,000. Short-term capital gains are taxed at 20% if sold within 12 months, while long-term capital gains above ₹1.25 lakh annually are taxed at 12.5% if held for over 12 months. The Groww Silver ETF split follows similar tax treatment, with the stock split being non-taxable as it doesn't change total investment value, though cost per share adjustments may impact capital gains tax calculations.
Investors require no action for ETF splits as additional units are automatically credited to their demat accounts. As reported by Mint, only investors who own the ETF on or before the record date are eligible for the split, while those purchasing after that date can purchase split-adjusted units directly. The holding period for capital gains tax calculation is based on the original purchase date, not the ETF split date. For example, if you bought an ETF on January 1, 2025, and it underwent a split on July 3, 2026, your holding period is calculated from January 1, 2025, to determine capital gains tax liability. The Groww Silver ETF split process follows standard procedures - shares are automatically credited to Choice Demat accounts with no investor action required, though new shares may take up to two working days to appear after the record date. Registered shareholders must own shares before the ex-split date and ensure their shares are in dematerialised form and fully paid up to be eligible for the split.
