IndiGo Shares Fall Nearly 4% After Two Major Large Trades

InterGlobe Aviation Ltd.'s shares fell nearly 4% on Tuesday as 2.23 crore shares worth Rs 6,591.34 crore changed hands in large trade deals on NSE.

IndiGo Airlines co-founder Rakesh Gangwal and a promoter entity are planning to offload up to a 5.7% stake in InterGlobe Aviation Ltd. for nearly Rs 11,385 crore via open market transactions, reported Bloomberg.

Gangwal and the Chinkerpoo Family Trust are offering as many as 1.3 crore shares in the company in a block sale, according to details in a termsheet accessed by NDTV Profit on Monday. The floor price for the IndiGo block deal is set at Rs 5,175 per share, a 4.5% discount to the last closing. However, according to a Bloomberg report, this was upsized to a 5.7% stake.

Multinational investment banks Goldman Sachs, JPMorgan and Morgan Stanley are the managers of the deal.

Gangwal personally holds 5.3% equity in InterGlobe Aviation, and the Chinkerpoo Family Trust holds another 8.23%, according to the latest shareholding data available on the BSE. The total promoter stake is 49.27%.

Rakesh Gangwal resigned from the board of directors of InterGlobe Aviation in February 2022 and had said he would gradually reduce his equity stake over the next five years.

Since then, he and promoter entities linked to him have sold shares worth Rs 26,900 crore. The residual stake — 13.58% — of the Gangwal Group is valued at Rs 28,434 crore.

The shares of IndiGo fell as much as 3.50% to Rs 5,230.50 apiece, the lowest level since May 9. It pared losses to trade 2.21% lower at Rs 5,299.50 apiece, as of 9:48 a.m. This compares to a 0.79% decline in the NSE Nifty 50 Index.

It has risen 24.62% in the last 12 months and 16.36% year-to-date. Total traded volume so far in the day stood at 151 times its 30-day average. The relative strength index was at 47. Above 70 is overbought or below 30 is oversold.

Out of 23 analysts tracking the company, 19 maintain a 'buy' rating, two recommend a 'hold,' and two suggest 'sell,' according to Bloomberg data. The average 12-month consensus price target implies an upside of 12%.