Digit Insurance files draft documents for Rs 5,000 crore IPO

Digit Insurance has filed draft paperwork for its initial public offering (IPO), and the digital insurance coverage firm is trying to elevate Rs 1,250 crore from a fresh issue of shares and an offer for sale (OFS) of 10.94 crore fairness shares.

The overall dimension of the IPO is anticipated to be about Rs 5,000 crore, two folks conscious of the discussions advised ET, requesting anonymity.

In July final 12 months, Digit, one of many first unicorns of 2021, had raised $200 million from current in addition to new buyers Faering Capital, Sequoia Capital India and IIFL Alternate Asset Managers, at a valuation of $3.5 billion.

ICICI Securities, Morgan Stanley India Co, , , and are the guide managers for the IPO, in line with the draft prospectus.

Digit might also think about taking a pre-IPO placement for a money consideration of Rs 250 crore earlier than submitting for its red-herring prospectus. If the pre-IPO placement goes by way of, the corporate will scale back the provide dimension, it stated.

The proceeds from the recent problem will assist the corporate increase its capital base and preserve solvency ranges. It can additionally use the capital for enterprise enlargement, it stated.

In line with the draft prospectus, shareholders promoting as a part of the OFS embody promoters – Go Digit Infoworks Companies, Nikita Mihir Vakharia, collectively with Mihir Atul Vakharia, Nikunj Hirendra Shah, collectively with Sohag Hirendra Shah, and Subramaniam Vasudevan, collectively with Shanti Subramaniam.

The corporate, which is backed by Canadian billionaire Prem Watsa, affords insurance coverage throughout motor, well being, journey, and property.

The corporate counts A91 Companions,

Shriram Development Fund, and Wellington Administration as its different main buyers. Go Digit Infoworks holds 83.6% stake within the entity.

Digit’s IPO comes at a time when new-age companies are taking a wait-and-watch strategy on itemizing plans.

Corporations together with Oyo Accommodations & Properties, Boat, PharmEasy, and Snapdeal have filed draft papers for his or her IPO however hit the pause button after the capital markets turned uneven.

Snapdeal and Oyo have but to get approval from capital markets regulator, Securities and Trade Board of India, for his or her draft IPO proposals.

Macroeconomic headwinds have crushed down expertise shares, with most new-age corporations that listed on the exchanges final 12 months presently buying and selling under their IPO worth.

Logistics participant Delhivery, whose IPO acquired a muted response, had additionally delayed itemizing plans and lowered the dimensions of the ultimate providing.

For the fiscal 12 months 2021-2022 (FY22), Digit stated it had 25.77 million prospects, up from the 14.27 million complete prospects it reported in FY21.

It had bought near 7.76 million insurance policies in FY22, from the 5.56 million insurance policies within the year-ago interval.

Complete belongings beneath administration shot up by virtually 68% yearly, at Rs 9,393.87 crore in FY22.

It reported complete revenues of Rs 3,840.9 crore in FY22, up from Rs 2,251.9 crore the 12 months earlier than.

Internet losses widened to Rs 295.86 crore in FY22, in comparison with the Rs 122.76 crore loss it recorded in FY21, the corporate stated within the draft prospectus.