I would like to implement a list picker with item grouping in the destination Asp.Net RadListBox.

Unfortunately the Telerik Asp.net RadListBox control does not seem to support item grouping natively. I have seen a forum post from 2019 that suggests adding custom group items https://www.telerik.com/forums/subheadings-in-radlistbox  We could do this but would prefer a more native solution.