IndiGo raises borrowing limit to fund future ops

The decision to increase the borrowing limit was taken by the board of directors of the Rahul Bhatia-promoted Interglobe Aviation, the company that runs IndiGo, at an extra-ordinary general meeting held on October 29, as per a filing on the Registrar of Companies earlier in November.

“The business has increased substantially as there has been acquisition of new aircraft to cater to new sectors,” the company said in the filing. “Accordingly, your company would require long-term capital funds to sustain the increasing level of operations that would necessitate borrowing from the market.”

IndiGo has one of the lowest debt levels compared with its peers. The indebtedness of the company as of September 20, the date of its last annual general meeting, stood at R1,139 crore.

Since 2007, the airline has gone from being a 18-aircraft fleet with 2,000 employees serving 17 domestic destinations to a 60-aircraft fleet with nearly 6,000 employees and flying to over 32 international and domestic destinations.

The airline, spearheaded by president Aditya Ghosh, has kept its debt levels low primarily because it operates a successful sale and leaseback model. The airline sells the aircraft immediately on acquisition and leases it back enabling the airline to have a younger average fleet age.

IndiGo turned profitable in 2008 and has remained so ever since. Earlier this

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