India's biggest airline is aiming at a valuation of around $4 billion through the IPO.
IndiGo's initial public offer (IPO) got off to a flying start on Tuesday, with 87 per cent of the issue subscribed on day one. The quota for Qualified Institutional Buyers was over-subscribed 2.96 times, while retail subscription stood at 5 per cent, according to data from the National Stock Exchange. IndiGo is offering shares in a price band of Rs 700 to Rs 765. The IPO will close for subscription on October 29. (Read: Should you subscribe?)
Here are 10 things to know about IndiGo's IPO:
1) InterGlobe Aviation, which operates the low-cost IndiGo airline, is aiming to raise a little over Rs 3,000 crore through India's biggest IPO since 2012. The country's biggest airline according to market share is aiming at a valuation of around $4 billion (Rs 26,000 crore) through the initial public offer (IPO).
2) Shares in other carriers - Jet and SpiceJet - which rallied sharply in the run-up to IndiGo IPO, closed with strong gains in a weak market today.
3) Ahead of the IPO, investment arms of foreign firms including Goldman Sachs, Fidelity, BlackRock, etc. bought IndiGo shares reserved for cornerstone investors, helping the airline raise Rs 830 crore.
4) "An IPO or listing gives you one more stamp of approval because with IndiGo one thing I have got used to is people doubting what we are doing... An IPO is a milestone...as a company, it is something you want to grow up to be... Being a listed company also makes sure we don't get complacent," IndiGo president Aditya Ghosh told NDTV.
5) IndiGo has a net debt of Rs 3,912 crore, all of which is related to aircraft purchases, according to Mr Ghosh. IndiGo plans to use the proceeds to retire Rs 1,166 crore of debt, while the remaining amount will be used to fuel expansion, the company said. IndiGo has 430 aircraft on order from Airbus.
6) There was some controversy ahead of the IPO as InterGlobe's net worth (total assets minus total liabilities of a company) slipped to a negative Rs 139 crore at the end of June 2015. The company, however, clarified that the airline's net worth is back in positive in the September quarter.
7) IndiGo has been the only consistently profitable airline in the country for the last seven years. Industry experts say the focus on cost by IndiGo's management team has helped the airline avoid the amount of debt that is weighing down the likes of Jet Airways and Air India.
8) IndiGo, which started flying in 2006, has risen rapidly to command almost 40 per cent market share in the domestic market. It also has one of the country's biggest fleets - 97 aircraft at present - allowing it to fly more frequently than other carriers. The average age of its fleet is around four years, which saves fuel costs.
9) IndiGo keeps costs low by buying just one type of aircraft from one supplier - Airbus - as well as selling and leasing back planes, and keeping maintenance costs low, experts have said. It has also benefited from its track record on punctuality, while falls in fuel costs have helped to boost revenue.
10) IndiGo was set up in 2006 by businessman Rahul Bhatia and Rakesh Gangwal, a former CEO for US Airways Group.
(With inputs from agencies)
Here are 10 things to know about IndiGo's IPO:
1) InterGlobe Aviation, which operates the low-cost IndiGo airline, is aiming to raise a little over Rs 3,000 crore through India's biggest IPO since 2012. The country's biggest airline according to market share is aiming at a valuation of around $4 billion (Rs 26,000 crore) through the initial public offer (IPO).
2) Shares in other carriers - Jet and SpiceJet - which rallied sharply in the run-up to IndiGo IPO, closed with strong gains in a weak market today.
3) Ahead of the IPO, investment arms of foreign firms including Goldman Sachs, Fidelity, BlackRock, etc. bought IndiGo shares reserved for cornerstone investors, helping the airline raise Rs 830 crore.
4) "An IPO or listing gives you one more stamp of approval because with IndiGo one thing I have got used to is people doubting what we are doing... An IPO is a milestone...as a company, it is something you want to grow up to be... Being a listed company also makes sure we don't get complacent," IndiGo president Aditya Ghosh told NDTV.
5) IndiGo has a net debt of Rs 3,912 crore, all of which is related to aircraft purchases, according to Mr Ghosh. IndiGo plans to use the proceeds to retire Rs 1,166 crore of debt, while the remaining amount will be used to fuel expansion, the company said. IndiGo has 430 aircraft on order from Airbus.
6) There was some controversy ahead of the IPO as InterGlobe's net worth (total assets minus total liabilities of a company) slipped to a negative Rs 139 crore at the end of June 2015. The company, however, clarified that the airline's net worth is back in positive in the September quarter.
7) IndiGo has been the only consistently profitable airline in the country for the last seven years. Industry experts say the focus on cost by IndiGo's management team has helped the airline avoid the amount of debt that is weighing down the likes of Jet Airways and Air India.
8) IndiGo, which started flying in 2006, has risen rapidly to command almost 40 per cent market share in the domestic market. It also has one of the country's biggest fleets - 97 aircraft at present - allowing it to fly more frequently than other carriers. The average age of its fleet is around four years, which saves fuel costs.
9) IndiGo keeps costs low by buying just one type of aircraft from one supplier - Airbus - as well as selling and leasing back planes, and keeping maintenance costs low, experts have said. It has also benefited from its track record on punctuality, while falls in fuel costs have helped to boost revenue.
10) IndiGo was set up in 2006 by businessman Rahul Bhatia and Rakesh Gangwal, a former CEO for US Airways Group.
(With inputs from agencies)
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