Mumbai: Go Digit General Insurance on Tuesday said its proposed amalgamation with holding company Go Digit Infoworks Services Pvt Ltd is aimed at creating a leaner corporate structure and direct alignment between promoters and the listed insurance entity, without materially impacting shareholding or capitalisation.
Speaking during an analyst call, chairman Kamesh Goyal said the merger would result in a marginal increase of just 0.03% in promoter shareholding, following the issuance of shares worth about ₹43 crore at ₹375.1 apiece, a premium to the prevailing market price at the time of announcement.
Goyal clarified that there are currently no transactions between the holding company and the general insurance arm, noting that earlier service arrangements had been discontinued in November 2024 at the regulator’s direction. “Today, the companies don’t have any transaction per se,” he said.
On capital requirements, the management ruled out any immediate need to raise equity. The company’s solvency ratio stood at around 226% as of September 30, well above regulatory requirements, while the equity issuance linked to the merger accounts for only about 1% of its net worth, the chairman said.
Chief financial officer Ravi Khetan added that even in the event of accelerated growth, the insurer has sufficient flexibility to raise Tier-2 capital through debentures. The company currently has about ₹350 crore of debentures outstanding and can raise up to 50% of its net worth through such instruments, management said.
The management also indicated that the board composition and day-to-day operations of Go Digit General Insurance will remain unchanged post-amalgamation, underlining that the move is largely structural rather than operational.