diff --git a/erpnext/setup/doctype/item_group/item_group.py b/erpnext/setup/doctype/item_group/item_group.py
index 0ff0088a8d2..8e1b7ec73f2 100644
--- a/erpnext/setup/doctype/item_group/item_group.py
+++ b/erpnext/setup/doctype/item_group/item_group.py
@@ -32,8 +32,11 @@ class ItemGroup(NestedSet):
 
 	def validate(self):
 		if not self.parent_item_group and not frappe.in_test:
-			if frappe.db.exists("Item Group", "All Item Groups"):
-				self.parent_item_group = "All Item Groups"
+			root = frappe.db.get_value(
+				"Item Group", {"parent_item_group": ("is", "not set"), "is_group": 1}, order_by="lft asc"
+			)
+			if root and root != self.name:
+				self.parent_item_group = root
 		self.validate_item_group_defaults()
 		self.check_item_tax()