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Go Digit Limited IPO Details: Date, Share Price, Size, GMP & Review

Go-Digit-Limited-IPO-DetailsDate-Share-Price-Size-GMP-Review

GO DIGIT – About the Company

Virat Kohli and Anushka Sharma backed GO DIGIT Insurance is all set to launch its IPO next week. GO DIGITal is a leading digital full stack insurance company that leverages AI and machine learning tools to offers a range of insurance products. The insurance products that company offers  ranges from motor, health, travel, property, marine, and liability insurance. The company leverages technology and other innovative approaches to bring new products and enhance customer experience. Digit Insurance in very less time has been able to corner healthy % of business as fresher in motor insurance segment.

In the nine months ended December 31, 2023 and 2023, Digit Insurance catered for approximately 82.5% and 82.1% of the GWPs written by digital full stack insurance players, including Acko and Navi, making it the largest digital full stack insurance player in India. As of Financial Year 2024, Digit Insurance has a Google rating of 4.7 out of 5.0 with over 0.22+ million reviews and a Facebook rating of 4.9 out of 5.0 with over 27,000+ reviews.

GO DIGIT IPO Objectives

GO DIGIT IPO consist of a fresh issue and offer for sale.

  • The selling shareholder and promoter looks to offload 54,766,392 equity shares aggregating up to Rs. 1,489.65 Cr.
  • The fresh issue comprises of up to ₹ 11,250 million and the funds would be used for maintenance of solvency ratio.

GO DIGIT IPO Details:

IPO Open Date May 15, 2024
IPO Close Date May 17, 2024
Basis of Allotment May 21, 2024
Listing Date May 23, 2024
Face Value Rs 10 per share
Price ₹258 to ₹272 per share
Lot Size 55 sahres
Total Issue Size 96,126,686 shares
(aggregating up to ₹2,614.65 Cr)
Fresh Issue 41,360,294 shares
(aggregating up to ₹1,125.00 Cr)
Offer For Sale 54,766,392 shares of ₹10
(aggregating up to ₹1,489.65 Cr)
Issue Type Book Built Issue IPO
Listing At BSE & NSE
QIB Shares Offered Not more than 75% of the Net Issue
Retail Shares Offered Not less than 10% of the Net Issue
NII (HNI) Shares Offered Not less than 15% of the Net Issue

 

GO DIGIT IPO Issue Price & Size

Issue price of GO DIGIT limited IPO has been set from Rs. 258 to Rs, 272 per equity share. Investors looking to bid can apply for the GO DIGIT IPO can bid between these price bands. The total issue size of the GO DIGIT IPO is Rs. 2,614 crores with offer-for-sale of Rs. 1,489 cr shares and a fresh issue of Rs 1,125 crores.

GO DIGIT IPO: Launch Date

The launch date for applying for this issue is May 15, 2024 till May 17, 2024. All types of investors can bid of this IPO between these dates through their eligible categories. Those successful investors who will get the allotment can their allotment status on May 21.

GO DIGIT Financial Statements:

For the 9 months ended 31 Dec 2023 For the 9 months ended

31 Dec 2022

FY23 FY22 FY21
Operating Profit / (Loss) -48.76 62.18 220.82 -417.48 -425.72
Fire Insurance 5.99 -31.06 -68.17 0.96 -5.04
Marine Insurance -58.45 -601.21 -815.4 -3334.91 -1424.16
Miscellaneous Insurance -101.22 -570.09 -662.75 -3751.43 -1854.92
Income From Investments
Interest, Div & Rent – Gross 977.84 632.38 992.01 749.75 558.17
Net Profit on sale of investments 431.56 59.6 60.19 65.27 111.26
Other Income
Interest on income tax refund - 2.3 2.42 - -
Profit on sale / discard

 of fixed assets

- - - - -
Others 0.14 - - - -
Other Expenses
Expenses other than

those related to Insurance Business

9.95 23.51 36.03 19.99 42.15
Bad debts written off - - - - -
Loss on sale / discard of fixed assets 0.07 0.47 0.37 2.11 -
Interest on Non-convertible

Debentures

8.13 - - - -
Others - - - - -
Profit/(Loss) After Tax 1290.17 100.21 355.47 -2958.51 -1227.65
Basic EPS 1.48 0.12 0.41 -3.55 -1.5
Diluted EPS 1.48 0.12 0.4 -3.55 -1.5

 

As at the end and/or for the
Particulars Units 9 months ended

 Dec 31, 2023

9 months ended

Dec 31, 2022

FY23 FY22 FY21
# of Customers millions 43.26 35.33 38.77 25.77 14.27
# of Policies Issued millions 8.46 7.71 1063 7.76 5.56
GWP Rs. millions 66798.78 52883.94 72429.85 52.676.333 32433.88
Retention Ratio % 84.3 79.1 81.6 79.4 81.2
Total investment income Rs. millions 7765.47 5165.09 7217.81 4367.36 3083
AUM Rs. millions 149090 118.262.46 126683.6 93938.75 55901.11
GDPI Rs. millions 59705.31 45345.07 61600.79 46739.41 24176.2
Net Earned Premium Rs. millions 51146.09 37673.19 51636.73 34042.26 19436.88
Net Written Premium Rs. millions 56314.71 41839.93 59093.38 42811.98 26323.05
Available Solvency Margin Rs. millions 26281.01 22692.83 23103.36 18676.23 11500.41
Required Solvency Margin Rs. millions 16446.34 11974.59 12978.67 9282.63 5728.88
Yield on total investments % 7.4 6.2 6.3 6.2 6.9
Loss ratio % 69.6 70.2 67.2 74 74
Expense Ratio % 14.4 36.6 37.8 34.8 32.8
Net Expense Ratio % 39.1 38.9 40.2 38.7 35.4
Combined ratio % 108.7 109.1 107.4 112.7 109.4
Solvency ratio Times 1.6 1.9 1.78 2.01 2.01
Commission Ratio % 24.7 2.3 2.4 3.8 2.6
IBNR (Gross) Rs. millions 55056.59 44150.23 45825.3 32297.83 18966.08
IBNR (Net) Rs. millions 50412.19 39547.78 41136.02 29310.3 17121.33

 

GWP CAGR over 9 month ended Dec 31, 2023 to 9 month ended Dec 31, 2022 (%) GWP Growth % over FY22 to FY23 (%) Loss Ratio (%) GWP Per Employee
9 months ended Dec 31, 2023 FY23 FY22 9 months ended Dec 31, 2023 FY23
GO DIGIT 26.3 37.5 69.6 67.32 74 18.33 24.55
ICICI Lombard 17.6 17.3 72 72 75 14.65 18.18
Bajaj Allianz 3.7 12.3 75.1 72.9 73 18.7 21.22
HDFC Ergo 12.1 23.1 82.6 79.9 84 12.77 17.66
TATA AIG 19.7 25.9 72 74..0 75 12.8 16.03
Reliance General 13.3 10.4 78.6 77.2 77.5 15.27 17.1
New India 10.5 5.3 98.1 95.6 99.5 25.57 29.01
Oriental 16.9 14.2 98 112.1 110.8 18.37 19.07
United 10.9 11.6 95.7 92.9 98.6 14.45 16.33
Overall non-life insurance mrkt 11.5 15.9 85 83 89.1 17.9 20.99

 

GO DIGIT IPO Promoters & Shareholding of the Company

As on the date of this Red Herring Prospectus, GO DIGIT has 4 promoters:

Name of the Promoter No. of Equity Shares % % of pre-Offer issued, subscribed

and paid-up Equity Share Capital

Kamesh Goyal NIL N.A.
GO DIGIT Infoworks Services Private Limited 729565220 83.30%
Oben Ventures LLP NIL N.A.
FAL NIL N.A.
Total 729565220 83.30%

 

Why Invest in GO DIGIT IPO?

While investing in an IPO-bounded company, one should check their fundamentals that help them to know its financial performance and competitive strength which at last drives its business growth. Fundamental analysis apart from financial and competitive strength, also help you to know the risk factors that can affect the business operations and future prospects of the company. After evaluating the variables such strength weakness, financials, you may strike a balance and decide to invest or not invest in an IPO.

Strengths

  • GO DIGIT offers customizable products that enhance the customers’ experience, achieving high net promoter scores of 73.3% for non-claims and 93.1% for motor claims.
  • For running a business effectively today, effective utilization of data is very necessary. AI and machine learning enables them to introduce innovative products in the market. GO DIGIT have leveraged their business expertise by utilising their data bank to construct comprehensive underwriting models. These models enable accurate risk assessment and loss prediction at a granular level for their motor insurance products.
  • GO DIGIT utilizes AI and machine learning technology to enhance efficiency for the benefit of partners and customers. As of December 31, 2023, they have 473 active AI-driven microsystem, which are feed with data they have collected to train the model to evaluate the applications and claims the company receives. The system can also scale-up or scale down automatically, depending on demand.
  • Agile organisational structure designed for rapid growth and adaptability.

Risks:

  • Companies' loss reserves are determined by estimating their future liability for claims. If the claim estimation undershoots net claims, it may result in increases in reserves, which might have an impact on profitability, business expansion, etc.
Dec 31, 2023 Dec 31, 2022 Mar 31, 2023 Mar 31, 2022 Mar 31, 2021
(in ₹ millions, except percentages)
Loss reserves 69206.84 54037.89 56232.43 38859.09 21494.14
GWP 66796.78 52883.94 72429.85 52676.33 32433.88
Loss reserves as % of GWP 103.60% 102.20% 77.60% 73.80% 66.30%

 

Dec 31, 2023 Dec 31, 2022 Mar 31, 2023 Mar 31, 2022 Mar 31, 2021
(in ₹ millions, except percentages)
Total gross claims 25704.44 14043.16 21442.27 9819.12 6169.55
Loss reserves at beginning of period 56232.43 38859.09 38859.09 21494.14 9567.8
Total gross claims as % of loss reserves 45.70% 36.10% 55.20% 45.70% 64.50%

 

  • The organization operates inside a regulatory framework and therefore, must adhere to a number of financial requirements, regulation related to product design and introduction of new products. The company's expansion may be slowed if it is compelled to cease providing insurance products or faces regulatory pressure on its normal operations.
  • Insurance business is in a business of insuring risks of individual and business. Such businesses are subject to unforeseen events, including natural disasters and extreme heating events, which could materially increase its liabilities for claims by customers. Any increase in upraise in claims can result in material adverse effect on its business, financial condition and results of operations.
  • As can be seen from table below, companies’ revenue and profitability relies considerably on motor vehicle insurance products. Drop in sales of new vehicles, unsatisfied client switching to a different insurer or slowdown in economic activity can have detrimental effect on the company's financial position.
9 months ended Dec 31, 2023 9 months ended Dec 31, 2022 FY23 FY22 FY21
Contribution

to GWP (%)

₹ millions Contribution

to GWP (%)

₹ millions Contribution

to GWP (%)

₹ millions Contribution

to GWP (%)

₹ millions Contribution

to GWP (%)

₹ millions
Motor 61.1 40808.02 59.1 31244.93 62.5 45273.79 62.2 32757.59 75 24328.34
Liability 1.7 1147.87 12 6335.88 9.2 6627.37 12.7 6715.94 2.3 749.03
Property and Engineering 11.4 7636.74 11.8 6250.14 10.4 7504.37 11 5781.18 13.6 4412.77
Health 14.9 9910.36 10.5 5550.64 10.5 7622.75 8 4194.8 5.6 1827.49
Personal Accident 3.6 2424.88 2.1 1087.07 2.4 1739.62 4.6 2432.8 0.9 280.76
Travel 0.3 180.62 0.5 292.59 0.5 395.92 0.3 131.8 0.1 21.13
Other 7 4688.49 4 2122.69 4.5 3266.03 1.2 662.22 2.5 803.36

 

  • If the company isn’t able to target new domains or enter another segment of insurance and keeps its reliance on its current proposition, any hindrances or overexposure in a particular segment could have negative implications for the company.
  • Company profitability and revenue stream depends on net premium they earn from clients. The insurer has to accurately underwrite the risk, take all charges under consideration and at same time remain profitable and cheap so that they can attract new clients. If the business is unable to underwrite risk accurately that could have negative effect on operations and financial condition of company.
Claims Ratio 9 months ended

 Dec 31, 2023

FY23 FY22 FY21
GO DIGIT 69.60% 67.20% 74.00% 74%
ICICI Lombard 72% 72% 75% 68.60%
Bajaj Allianz 75.10% 72.90% 73.00% 68.50%
HDFC Ergo 82.60% 7.90% 84.00% 75.70%
TATA AIG 72.00% 74% 75% 68.70%
Reliance General 78.60% 77.20% 77.50% 79.60%
New India 98.10% 95.60% 99.50% 84.20%
Oriental 98.00% 112.10% 110.80% 95.30%
United 95.70% 92.90% 98.60% 88.50%

 

Net Expense Ratio 9 months ended Dec 31, 2023 FY23 FY22 FY21
GO DIGIT 39.10% 40.20% 38.70% 35%
ICICI Lombard 32% 32% 34% 31.20%
Bajaj Allianz 24.20% 27.60% 26.70% 28.40%
HDFC Ergo 23.70% 23.40% 23.40% 27.50%
TATA AIG 36.80% 36% 33% 41.50%
Reliance General 32.80% 33.20% 30.70% 33.30%
New India 22.60% 21.60% 21.20% 45.70%
Oriental 20.90% 42.40% 33.50% 35.80%
United 28.40% 47.90% 37.50% 34.30%

 

GO DIGIT IPO Grey Market Premium

Grey market premium is the premium quoted over the IPO issue price. GMP shows that investors are ready to pay above the upper band of the IPO issue price. GMP is determined in the grey market as per the demand and supply of the shares in the primary market. A grey market is that unofficial ecosystem of unlisted companies' stocks that start trading even before the launch of the IPO to the date of its listing.

Also Read: What is Grey Market Premium in IPO: How is GMP Calculated & Reliable

However, GMP is not a reliable factor, as it keeps fluctuating as per the demand and supply of shares in the primary market. There are numerous factors that affect the stock market in India and individual stock prices of different companies that are already listed and trading in the secondary market. However, for an IPO-bounded company, you can consider the GMP as the speculative listing price of the share

According to various online sources, the Grey Market Premium or GMP of the GO DIGIT is trading around Rs 50 in the grey market. It means shares are trading at the upper band issue price of Rs 50 with a premium in the grey market and may list around the same price.

How to Apply for GO DIGIT IPO?

To apply in GO DIGIT IPO you need to open demat account to hold your allotted shares and a trading account to sell or buy the shares into the secondary market. And not only applying in the IPO, but while buying or selling the shares in the stock market you also need both these types of accounts. Hence, you can apply here at Moneysukh to open a trading and demat account at the lowest brokerage.

Also Read: Features of Best Demat Account with Lowest Brokerage Charges in India

Having both these accounts at Moneysukh, you will get the advantages of the best online trading apps to trade or invest in equitiescommodities and currencies. Here you will get the flexibility to choose the best trading platform and advanced trading software like Keev,TradeTronQuantmanAlgoBulls,Trade Radarand FoxTrader all integrated with TradingView to facilitate the best trading experience.

Also Read: Equity or Commodity which is better for Trading or more Profitable

Moreover, you can also start algo-trading – a high-frequency trading mechanism to choose the best algo-trading platforms and trade with best intraday algo-trading strategy at the lowest brokerage pricing. At Moneysukh you can also get stock recommendations and tips backed with research reports and useful tutorials on the stock market to help the clients understand the stock market in a better way. However, right now to apply for the GO DIGIT IPO you can follow the steps given below.

Steps to Apply for GO DIGIT IPO:

Step 1: When GO DIGIT IPO opens you can bid online.

Step 2: Just go to trade.moneysukh.com and log in with your User ID & password.

Step 3: Now look for the IPO section and click on the GO DIGIT IPO.

Step 4: Here you need to fill in the required details like price, quantity, and so on.

Note: At the time of applying for the IPO, make sure to bid at the cutoff price and then submit your application. 

Step 5: Now make the required payment and then submit your IPO application successfully.

How to Check GO DIGIT IPO Allotment Status?

Checking the allotment status online is very easy if you have the PAN details and IPO application number. But checking the details of the IPO allotment is possible only when the basis of allotment is arrived. In the case of GO DIGIT IPOyou can also check the allotment status through various online sources.

Also Read: How to check IPO allotment status on NSE, BSE through Moneysukh

And the basis of the allotment is highly dependent on the oversubscription of the IPO. If the IPO is oversubscribed by many folds, then for the investors who applied through the retail category or HNI category, the chances of getting the allotment become very low. Here while applying to such over-demanding IPOs you can follow some tips to improve your chances of getting the allotment in IPO.

Also Read: How to Increase the Chances of IPO Allotment

And when due to oversubscription of IPOs, you don’t get any allotment of shares, then your money will be refunded back into your bank account or fun will be unblocked if you applied through ASBA. However, despite the oversubscribed IPO, if get the allotment then the allocated shares will be transferred into your demat account any time before the date of listing. That you can sell in the secondary market after listing or keep from the long-term investment point of view.

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