The insurtech unicorn plans to use the net proceeds from the IPO to strengthen its solvency ratio and capital reserves.
The IPO will conclude on May 17 and consists of a combination of fresh issuance worth Rs 1,125 crore and a stake sale by existing shareholders. Notable investors such as celebrity couple Virat Kohli and Anushka Sharma are expected to retain their investment in the company; they had received 333,334 shares valued at Rs 10 each in February 2022.
The offering includes an offer-for-sale component of up to 54,766,392 equity shares by selling shareholders. One of the main promoters, Go Digit Infoworks Services Private Limited, is set to sell up to 54,755,614 equity shares, according to the Red Herring Prospectus.
Go Digit General Insurance is predominantly owned by Go Digit Infoworks Services, which holds an 83.3% stake in the company. However, on May 4, Go Digit General Insurance was penalised Rs 1 crore by the Insurance Regulatory and Development Authority (IRDAI) due to the non-disclosure of a change in the conversion ratio of compulsorily convertible preference shares (CCPS) issued to Fairfax-owned FAL Corporation, as reported by MoneyControl.
According to reports, the company had issued 78,00,000 CCPS instead of the initially agreed 63,00,000, adjusting the conversion ratio from “1 CCPS for 2.324 equity shares” to “2.324 CCPS for 1 equity share.” Although Go Digit reported this change in its JV agreement amendment and DRHP filing, it failed to fully inform the regulator, violating Section 26 of the Insurance Act.
The insurtech company secured approval from the market regulator, the Securities and Exchange Board of India (SEBI), for its IPO in March.
