Go Digit General Insurance Limited (GODIGIT.BO) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to Go Digit Business Update Conference Call hosted by ICICI Securities Limited. [Operator Instructions] I now hand the conference over to Mr. Kamesh Goyal, Chairman of Go Digit. Thank you, and over to you, sir.

Good evening, everyone. I'm joined on this call with Ravi, our CFO; Piyush, our Head of Investor Relations; and Tejas, who is our company secretary. I think you are aware, we had released a press release on Friday, this Friday, regarding merger of -- amalgamation of Go Digit Infoworks with Go Digit General Insurance Company Limited. Basic idea is to create a direct alignment between the insurance company and the promoters, and also have a leaner sort of a corporate structure. We had also given in the press release the shareholding pre and post merger. You would notice that the promoter shareholding is only increasing by 0.03% in the General Insurance Company, and that is essentially due to issuance of shares worth about INR 43 crores at a price of INR 375, which on the day of announcement, that is 19th December, the market value was about INR 341, INR 342, so at a premium of that. We had also mentioned that from a perspective of Board of the General Insurance Company, the management team, everything stays as it is. So that really is, briefly, I'm just reading in a way from the press release itself. We thought we'll just do the short call in case anyone has any questions relating to this amalgamation scheme. Happy to answer that.

[Operator Instructions] Our first question comes from the line of Ansuman Deb from ICICI Securities.

Your communication is quite clear, but just 2 questions. One is the fact that is there any revenue or any transactions between the holding company and -- previously the holding company and the company which used to be there? And what kind of -- if it continues right now, or is there any chance in the future? That is one. Second is the fact that in terms of capital movement, it becomes easier, I understood. But is there any kind of intention or possibilities in that line? So that will be the 2 questions.

Thanks, Ansuman. So this company had -- the holding company had some outsourcing arrangement for some activities with the General Insurance Company. But regulator had asked to stop these activities. And the same was stopped in November 2024. So roughly about a year old. So today, the companies don't have any transaction per se. Secondly, I think on the capital side, our solvency as of 30th of September, for which the published data is there, is close to about 230%. So there is no need for us to raise capital. The additional INR 43 crores of shares which are being issued are roughly about just 1% of the net worth of the company. So this is not going to make a substantial difference to the overall capitalization of the company. And as of now, we don't foresee company requiring any additional capital in near future. Secondly, as all of us know that 50% of the net worth can be raised through Tier 2 bonds or through the debentures. And company has, as of now, only INR 350 crores of debentures. So even if there is any need for capital due to higher growth, the company has more than enough space to raise Tier 2 capital through debentures. So we don't really foresee need for raising any capital or equity capital in the company in near future.

[Operator Instructions] As there are no questions from the participants, I would like to hand the conference over to the management for the closing comments. Thank you, and over to you, management.

Thanks, everyone, for joining. As I said, I think from our side, we tried to make press release as transparent as possible, and it seems there's no other questions. So we can thank you for joining and hope that you'll join us again next month when we have our Q3 results. Thanks, everyone, for joining.