Go Digit Stocks shares had a lackluster debut on Dalal Street Thursday, aligning with anticipated market sentiment based on the company’s grey market premium.
Go Digit General Insurance Ltd’s shares had a subdued start on Dalal Street Thursday, with a marginal premium of 5.15% over its issue price of Rs 272 on NSE, opening at Rs 286. Similarly, on BSE, the stock began trading at a 3.35% premium at Rs 281.10.
Navigating Go Digit Stocks: Understanding the IPO Journey
The lackluster listing aligns with expectations, as indicated by the grey market premium for the company. Before listing, Go Digit General Insurance shares commanded a Rs 8-10 grey market premium, implying around 3% listing gains for investors. However, just hours before listing, the unofficial market premium rose to Rs 30-32.
Pune’s Go Digit General Insurance IPO, priced at Rs 258-272 per share with a lot size of 55 shares, ran from May 15 to May 17. The new-age insurer garnered Rs 2,614.65 crore in total from its primary offering, comprising Rs 1,125 crore from fresh share sales and an offer-for-sale (OFS) of up to 5,47,66,392 equity shares.
The overall subscription stood at 9.60 times. QIBs’ quota was oversubscribed 12.56 times, non-institutional investors’ 7.24 times, and retail investors’ 4.27 times during the three-day bidding process.
Go Digit General Insurance, supported by Prem Watsa’s Fairfax Group, offers a range of insurance products including motor, health, travel, property, marine, liability, and customizable options for customers.
Morgan Stanley India Company, Axis Capital, Nuvama Wealth Management, HDFC Bank, and IIFL Securities serve as the Go Digit IPO’s book running lead managers, with Link Intime India acting as the issue’s registrar.
Go Digit General Insurance debuted quietly on May 23 at Rs 286, a 5.14% premium over the Rs 272 issue price. Shortly after listing, the share price surged by 6%, reaching Rs 301, marking an 11% increase. These gains align closely with grey market projections, which anticipated a 3% premium.
Likewise, the stock commenced its inaugural session with a 3.34% premium over the issue price at ₹281.10 on the BSE. Nonetheless, the listing fell short of expectations.
Shreyansh V Shah of StoxBox had anticipated a significant listing, with shares projected to debut around ₹300 each, representing an approximate 10% increase from the issue price. He advised investors to retain the stock for the long term.
Shivani Nyati of Swastika Investmart stated that while the IPO valuation might appear high relative to recent earnings, Go Digit’s robust technological advantage and position in India’s expanding insurance sector provide significant long-term profit potential. The Go Digit IPO was oversubscribed nearly 10 times by the end of the day, driven by enthusiastic interest from both retail and institutional investors.
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