It's not fully stable, but you can try following config.

$grid["grouping"] = true;
$grid["groupingView"] = array();

$grid["groupingView"]["groupField"] = array("field1","field2"); // specify column name to group listing
$grid["groupingView"]["groupDataSorted"] = array(true,true); // show sorted data within group
$grid["groupingView"]["groupSummary"] = array(true,true); // work with summaryType, summaryTpl, see column: "total";

$grid["groupingView"]["groupColumnShow"] = array(false,false); // either show grouped column in list or not (default: true)
$grid["groupingView"]["groupText"] = array("<b>{0} – {1} Item(s)</b>"); // {0} is grouped value, {1} is count in group
$grid["groupingView"]["groupOrder"] = array("asc"); // show group in asc or desc order
$grid["groupingView"]["groupCollapse"] = true; // Turn true to show group collapse (default: false)
$grid["groupingView"]["showSummaryOnHide"] = true; // show summary row even if group collapsed (hide)

Refer demos/appearence/grouping.php for more help.

To change label text of header, just like we do in footer-row summary js.

$("#list1").jqGrid('setLabel','<COL-NAME>','<NEW-LABEL>');

is it available in the free version?

Most likely, it will work.
I am sending you sample on email.