IndiGo, India’s largest airline by market share has fixed a price band of Rs 1,125-1,175 per share for its planned qualified institutional placement of shares which opens on September 15, a move which will help the company achieve the minimum public shareholding of 25%, by reducing the owner’s stake. Yesterday, the share prices closed at Rs 1,196 on BSE. The company said in a stock exchange filing, “The price band was approved at Rs 1,125-Rs 1,175 per share.”
According to a regulatory filing issued by the company earlier, the company will sell up to 33.57 million shares, which includes a fresh issue of 22.38 million shares and a secondary share sale of 11.19 million shares by promoters Rakesh Gangwal, Shobha Gangwal, Asha Mukherjee and the Chinkerpoo Family Trust. At the higher end of the price band, the company will raise up to Rs 3,948, while at the lower end, the company will raise up to Rs 3,780.
The company which listed on the stock exchanges on 10 November 2015, will have to achieve the 25% shareholding within three years of listing, according to regulation. As at the end of June,the founders of InterGlobe held 85.85% in the company. InterGlobe has to reduce its promoters’ holding from 85% to 75% to meet the regulatory norm.
Further, the amount raised will also be deployed for funding the expansion plans of the company. IndiGo’s outstanding order for aeroplanes — the largest for any airline in the world — is a testament to this ambition. The airline has 458 aircraft on order, scheduled for delivery over the next decade, to add to its existing 135 aircraft, which is also the largest fleet for any airline in India.
The shares have returned 46% in the year so far as compared to the 21% returned by BSE Sensex in the same period. IndiGo shares have seen a slight correction of late and the shares have shed 3.5% in the last month. On Tuesday morning, the scrip was trading at Rs 1,183.5, down by more than 1.2%.
The no-frills airline, which has the largest share in the domestic aviation market, expects to have 20 turbo prop aircrafts by January 2019, which it plans to deploy on the regional routes under the UDAN scheme initiated by the government of India.