IndiGo's Rs 2,500-cr IPO gets Sebi nod

Low-cost airline IndiGo’s parent company, InterGlobe Aviation, has secured approval from the Securities and Exchange Board of India (Sebi)for a Rs 2,500-crore initial public offering (IPO).

InterGlobe Aviation runs the country’s biggest airline by market share under the IndiGo brand.

Under the offer, the company plans to issue fresh shares worth Rs 1,272 crore. An equivalent amount could be raised through the sale of up to 30.1 million shares by existing shareholders. Sebi cleared the proposed initial share sale and gave its final observations on the IPO on September 11. The papers for raising up to Rs 2,500 crore through the IPO were filed with Sebi in June this year.

Citigroup, JPMorgan India, Morgan Stanley, Barclays, UBS Securities India and Kotak Mahindra Capital Company will manage the share sale.

IndiGo is one of the two profit-making domestic airlines, the other being GoAir. The budget carrier saw its net profit jump four-fold to Rs 1,304 crore last financial year. This was the highest annual profit registered by the airline since its inception in 2005. It had posted a net profit of Rs 317 crore in the year ended March 31, 2014.

IndiGo’s good show in the last financial year was primarily on account of higher revenue, despite the domestic aviation sector witnessing turbulent times, which adversely impacted the balance sheets of most local carriers. IndiGo saw its revenue climb to Rs 14,320 crore in 2014-15, an increase of 25 per cent from Rs 11,447 crore in 2013-14.

The airline has recorded profits for seven straight years.