Is there any limitation in creating the group and subgroups in SEPM 12.1
keep it as few as you can.
check the sizing guide as well
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What database are you using? MS SQL will be much better while handling a greater amount of group. There are no written limitations - recommendation is to limit these as much as possible - the more group the more processing on both SEPM and DB side, but have a look at the Scalability and Sizing Recommendations for SEP - this document should help you further more.
I am agree with Sebastian's comments, if you want more Groups you should use SQL data base.
Iam using SQL
SQL handles more clients , however you need to keep the groups as low as you can. As suggested above,there will be extra load on SEPM to list the groups.
It depends on the hardware specs of your DB host. You can add that amount of groups but there could be a performance hit if you have inadequate hardware.
Symantec Endpoint Protection (SEP) Sizing and Scalability recommendations
You can create the groups as much as you can but its better you used the SQL as the database