About Go-Digit

Go Digit General Insurance Limited plans to raise over Rs 2,600 crore through its Initial Public Offering (IPO). The IPO opened for subscription on May 15 and will close on May 17. The latest IPO updates of the company and key details of the Red Herring Prospectus (RHP) are discussed in this blog.

Investing in an IPO is thrilling as it enables you to join a company’s growth journey. When a company offers shares through an IPO, numerous investors eagerly seek to gauge its potential. To do so, they require a wealth of detailed information about the company, including its business, competition, and financials.

The Securities and Exchange Board of India (SEBI) requires companies launching an IPO to share specific information about their business, finances, and risks in the Red Herring Prospectus or RHP document.

Go-digit is an insurance company founded by Mr. Kamesh Goyal. The company offers motor, health, travel, property, marine, and liability insurance.

The shares will be listed on both BSE and NSE on May 23, 2024.

Pre-offer details of the Promoters in Go-digit

Sr. No.	Name of the Promoter	No. of Equity Shares	% of Pre-Offer issued, subscribed, and paid-up Equity Share Capital
1.	Kamesh Goyal	Nil	N.A.
2.	Go Digit Infoworks Services Private Limited	729,565,220	83.30
3.	Oben Ventures LLP	Nil	N.A.
4.	FAL	Nil	N.A.
	Total	729,565,220	83.30

Summary of the ongoing IPO, as of May 16, 2024, 6:03 pm

The Go Digit IPO was subscribed 0.79 times. The retail category had a subscription of 2.56 times, while the QIB category had a subscription of 0.24 times, and the NII category had a subscription of 0.73 times by May 16, 2024, at 6:03:06 PM.

Investor Category	Subscription (times)	Shares Offered	Shares bid for	Total Amount (Rs Crores)
Anchor Investors	1	4,32,57,009	4,32,57,009	1,176.591
Qualified Institutions	0.24	2,88,38,007	68,65,980	186.755
Non-Institutional Buyers	0.73	1,44,19,002	1,04,97,740	285.539
bNII (bids above ₹10L)	0.64	96,12,668	61,72,155	167.883
sNII (bids below ₹10L)	0.90	48,06,334	43,25,585	117.656
Retail Investors	2.56	96,12,668	2,46,36,150	670.103
Total	0.79	5,28,69,677	4,19,99,870	1,142.396

Total Applications: 315,336

Go Digit’s IPO Subscription Details (in number of times)

Date	QIB	NII	Retail	Total
Day 1 May 15, 2024	0.00	0.35	1.50	0.37
Day 2 May 16, 2024	0.24	0.73	2.56	0.79

Go Digit IPO is offering 96,126,686 equity shares to the public. Of these, 9,612,668 shares are available to retail investors, 28,838,007 to qualified institutional buyers, and 14,419,002 to non-institutional investors.

Category	Shares Offered	Amount (Rs Cr)	Size (%)
Anchor Investor	43,257,009	1,176.59	45.00%
QIB	28,838,007	784.39	30.00%
NII	14,419,002	392.20	15.00%
bNII (bids above ₹10L)	9,612,668	261.46	10.00%
sNII (bids below ₹10L)	4,806,334	130.73	5.00%
Retail	9,612,668	261.46	10.00%
Total	96,126,686	2,614.65	100%

IPO Investors’ Categories

Investors can be categorised into different groups when participating in an IPO:

1. Qualified Institutional Buyers (QIB): This group includes Financial Institutions, Banks, FIIs, and Mutual Funds registered with SEBI.

2. Non-Institutional Investors (NII): This category consists of retail individual investors (HNIs), NRIs, companies, and trusts bidding for shares worth more than Rs 2 lakhs. The NII category has two sub-categories:

   – Small NII: Includes NII investors bidding for shares between Rs 2 lakhs and Rs 10 lakhs.

   – Big NII: Comprises NII investors bidding for shares worth more than Rs 10 lakhs.

3. Retail Individual Investors (RII): This category includes retail individual investors or NRIs applying for up to Rs 2 lakhs in an IPO.

4. Employee (EMP): This category is for eligible employees with a reserved IPO quota.

5. Others: This category includes eligible shareholders or other investors with a reserved IPO quota.

Risks associated with this IPO, as per RHP.

• This is the Company’s first offering of Equity Shares to the public. Since there is yet to be a formal market for the Equity Shares, their face value is Rs 10 each.
• Through a book-building process, the Company’s Board of Directors has determined the Floor Price and cap Pre-offer Price in consultation with the BRLMs. However, these prices may not reflect the market price of the Equity Shares after they are listed.
• They cannot guarantee active or sustained trading in the Shares or the price at which they will be traded after listing.
• It’s important to understand that equity investments and equity-related securities carry a degree of risk. Investors should only invest funds if they are fully prepared to risk losing their entire investment.
• Investors are advised to carefully read the risk factors before investing in the Offer as per the RHP. It is important for investors to thoroughly examine our Company and the Offer, including the associated risks, before making an investment decision.
• The Equity Shares in the Offer have not been recommended or approved by SEBI, and SEBI does not guarantee the accuracy or adequacy of the contents of this Red Herring Prospectus. Investors are encouraged to pay specific attention to the “Risk Factors” on page 41 of the RHP of Go Digit Company on SEBI’s website.

Details of Pre-IPO issue

Go Digit General Insurance raised Rs 1,176.59 crore from anchor investors as part of the IPO, on May 14, 2024.

They allocated a little over 4.32 crore shares at Rs 272 per share.

The anchor investors included Fidelity Investment Trust, Bay Pond Partners L.P., Goldman Sachs, Abu Dhabi Investment Authority (ADIA), Schroder International, East Spring Investments India, Custody Bank of Japan, SBI Mutual Fund, ICICI Prudential Mutual Fund, Axis Mutual Fund, and others.

Virat Kohli, the famous Cricketer purchased 2,66,667 equity shares at Rs 75 per share, investing Rs 2 crore in February 2020. Anushka Sharma acquired 66,667 equity shares at the same price, amounting to an investment of Rs 50 lakh in the company, in a private placement.

Virat Kohli also has preemptive rights and a tag-along right, as mentioned in the Red Herring Prospectus (RHP).

Furthermore, Go Digit Infoworks Services Private Limited respects the legal rights of all parties involved. In line with this, we grant Go Digit Infoworks Services Private Limited the right of first offer if Virat Kohli wishes to sell any or all of his shares to a third party other than Go Digit Infoworks Services Private Limited or Kamesh Goyal.

ICICI Securities Limited, Morgan Stanley India Company Private Limited, Axis Capital Limited, HDFC Bank Limited, IIFL Securities Limited, Nuvama Wealth Management Limited, and Link Intime India Private Limited are the registrars to the Offer.

The company has reduced its offer-for-sale (OFS) component to 5.47 crore equity shares from the previously proposed 10.94 crore shares.

IPO Details

• The IPO is divided, with 75% reserved for qualified institutional bidders (QIBs), 15% for non-institutional investors, and 10% for retail investors.
• The company achieved profitability in the financial year 2023-24, reporting a net profit of Rs 35.54 crore with a revenue of Rs 39.19 crore.
• For the nine months ending December 31, 2023, its net profit was Rs 129.02 crore with a revenue of Rs 130.83 crore.
• The company plans to use the new funds to expand its capital base, maintain solvency levels, and for general corporate purposes.
• The promoter, Go Digit Infoworks Services Private Ltd, will sell up to 5.475 crore shares. Additionally, other selling shareholders plan to sell a total of 10,778 shares.
• The company’s operating loss decreased from Rs 185.49 crore in FY21 to Rs 10.12 crore in 9MFY24, and this trend is expected to continue in FY25 due to the company’s robust growth and industry prospects in India.
• The company’s exchange filing shows that it offered 43.25 million equity shares to anchor investors at Rs 272 per share.
• Fidelity Investment Trust was allocated the highest portion at 7.95%.
• Other major foreign investors included Bay Pond Partners L.P., Goldman Sachs, Abu Dhabi Investment Authority (ADIA), Schroder International, East Spring Investments India, and Custody Bank of Japan.
• Among domestic investors, SBI Mutual Fund, ICICI Prudential Mutual Fund, Axis Mutual Fund, Mirae Asset Mutual Fund, HDFC Life Insurance, ITPL Invesco India Mutual Fund, Tata Mutual Fund, Volrado Venture Partners Fund, Motilal Oswal Mutual Fund, Edelweiss Trusteeship Co Ltd AC, Max Life Insurance, Tata AIA Life Insurance Company, Bajaj Allianz Life Insurance Company, and Morgan Stanley Asia (Singapore) PTE ODI participated as anchor investors in the Go Digit IPO.
• The IPO, valued at Rs 2,615 crore, opened for subscription on Wednesday, May 15. It has a price range of Rs 258 to Rs 272 per equity share and will close for subscription on Friday, May 17, 2024.
• The IPO consists of a fresh issue of 41.4 million shares worth Rs 1,125.00 crore and an offer for sale (OFS) of 54.8 million shares totaling Rs 1,489.65 crore.

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