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Go Digit Insurance IPO: Retail portion fully booked even as overall demand remains steady on Day 1

1 week ago 37

The initial public offering (IPO) of Go Digit Insurance is being lapped up by retail investors with the category getting fully subscribed even though the overall demand remained steady on the first day.

The IPO, which closes on May 17, was booked 23% so far with the NII portion receiving a subscription of 15%. There are yet to be bids made in the QIB category.

Ahead of the issue opening, the Bengaluru-based insurtech startup raised about Rs 1,176 crore in the anchor round, where Fidelity Investments, Goldman Sachs, ADIA, and Custody Bank of Japan were among the investors.

The offer is a mix of a fresh issue of Rs 1,125 crore and an offer for sale (OFS) of up to 54.77 million equity shares by promoters and other selling shareholders.

In 2020, cricketer Virat Kohli bought 2.66 lakh shares of the company for Rs 2 crore, while Anushka Sharma invested 50 lakh through a private placement.

The insurance firm plans to utilise the net proceeds towards augmenting its capital base and maintaining the solvency levels.

Go Digit Insurance IPO review
Analysts advised investors to subscribe to the issue as their advanced technology platform and predictive underwriting model position well for continued innovation and growth.

"Despite the aggressive valuation relative to recent earnings and operating losses, Go Digit's strong technological capabilities and its position in a growing market suggest potential for future profitability. Considering these factors, we recommend a subscribe rating for this IPO," said Swastika Investmart.
Also Read: Go Digit Insurance IPO: GMP, price band among 10 things to know before subscribing to the issue

Go Digit IPO GMP
In the unlisted market, the company's shares are trading with a GMP of Rs 45, slightly lower than the previous week.

Go Digit Insurance IPO price band
The company has fixed a price band of Rs 258-278 per share for its maiden public offer. At the upper end, the company plans to raise Rs 2,615 crore.

Investors can bid for a minimum of 55 shares in one lot and in multiples thereafter. About 75% of the public offer is reserved for QIB (qualified institutional buyers) investors, 15% for non-institutional investors, and the remaining 10% for retail investors.

Other details
Go Digit is a leading digital full-stack insurer and the fastest-growing private non-life insurer by GWP in India. They offer a simplified and customized customer experience, with a strong focus on empowering their distribution partners.

In the nine months ending December 2023, Go Digit's net earned premium rose to Rs 5,115 crore vs Rs 3,767 crore in the corresponding period of the previous financial year. It reported a profit after tax of Rs 129 crore in the 9 months vs Rs 10 crore in the first 9 months of FY23.

ICICI Securities, Morgan Stanley India, Axis Capital, Edelweiss Financial Services, HDFC Bank, and IIFL Securities are the book-running lead managers for the IPO.

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