GoAir IPO likely next fiscal as it awaits clarity on A320 neos

Airline mum on offer plans, sources say it will be looking to raise around Rs 1,000-1,200 crore

Carrier GoAir plans to come out with its initial share sale offer in the next financial year amid  uncertainty over delivery of new Airbus aircraft, key for the no-frills carrier’s growth strategy.

The airline originally was looking to hit the capital market in the current financial year, which saw budget carrier IndiGo’s blockbuster initial public offering (IPO).

Sources said GoAir is still awaiting clarity on the delivery of 72 Airbus A320 Neo planes before taking a final decision on the IPO’s timing.  Delivery of the aircraft was to start from April this year.

While the Wadia group airline has not officially made its IPO plan public, sources said GoAir would be looking to raise around Rs 1,000 crore.

At current exchange rate, this would translate into Rs 1,000 to 1,200 crore.

Apart from aircraft delivery schedule, GoAir would also be taking into account market conditions before deciding on the IPO timing, sources said.

GoAir's ambitious fleet expansion plans have taken a hit with European aircraft maker Airbus recently indicating a potential delay in the delivery schedule for A320 Neos due to some "industrial reasons".

The airline was supposed to have 26 Airbus A320 neos by end of 2017. In June 2011, it had placed order for 72 new A320 neos, valued at about Rs 32,400 crore on list price, with Airbus.

Currently, GoAir has 19 A320s in the fleet operating 144 daily flights across 22 domestic destinations.

The IPO would help the carrier raise funds for international operations, which it would start after having a fleet of minimum 20 planes.

Under existing regulations, domestic carriers can fly overseas only if they have at least five years of operational experience and a minimum of 20 aircraft.

Once it comes out with the IPO, GoAir would be the fifth local airline to get listed after Jet Airways, SpiceJet and IndiGo. Kingfisher, which was listed, grounded its operations in December 2012.

In October last year, IndiGo's parent InterGlobe Aviation mopped up little over Rs 3,000 crore through its IPO.