Take a GroupBox, put let say Label inside and then set AutoSizeMode = GrowAndShrink and AutoSize = true.
Two prob
It seems as though the GroupBox control has a predefined padding of sorts when growing the control if AutoSize = true. That is, once a control (inside the GroupBox) gets within 20 pixels or so of the bottom of the GroupBox, the GroupBox starts growing. This causes a 20 pixel or so padding from the bottom of the bottom-most control to the bottom of the GroupBox (as highlighted in yellow by @Sinatr's attached image).
Based on my observations, the padding seems to be less when growing the Width of the GroupBox.
At any rate, you can do something like the following "get around" the issue:
public void MyFunction()
{
groupBox1.AutoSize = true;
// Do stuff (e.g., add controls to GroupBox)...
// Once all controls have been added to the GroupBox...
groupBox1.AutoSize = false;
// Add optional padding here if desired.
groupBox1.Height = myBottomMostControl.Bottom;
}