IndiGo Airlines Promoter Set to Offload More Shares Amid Stock Strength

Rakesh Gangwal, the promoter and one of the founders of IndiGo Airlines, is reportedly preparing to sell another significant portion of shares in the airline’s parent company, InterGlobe Aviation. This move comes as the 150-day share sale embargo period concluded on February 13, 2024. According to India’s CNBC, Gangwal aims to capitalize on the robust stock performance of IndiGo, with investor interest roadshows currently in progress.

Gangwal, along with his immediate family and associated entities, currently holds a 25.2% stake in InterGlobe Aviation. The family has been gradually reducing its stake over the past few years through a series of transactions. Notably, in September 2022, they sold a 2.7% stake at INR1,850 per share, followed by a 3.7% stake sale in February 2023 at INR1,887 per share, and then a 5.8% stake in August 2023 at INR2,400 per share. As of the close of trading on February 13, 2024, InterGlobe shares were valued at INR3,047.

Despite facing operational challenges, including issues with Pratt & Whitney engines and supply chain disruptions, IndiGo has reported five consecutive quarters of profit. The airline recently announced an after-tax profit of INR29.981 billion for the quarter ending December 2023. Under the leadership of CEO Pieter Elbers, IndiGo is targeting a growth rate of 20% for the current financial year.

Gangwal, who resigned from InterGlobe’s board in early 2022, had previously announced plans for him and his family to divest their shareholding, which was over 37%, within a five-year timeframe. InterGlobe Aviation’s other major shareholder is InterGlobe Enterprises, controlled by the Bhatia family, with a 38.1% stake.

This strategic share sale aligns with Gangwal’s systematic approach to divesting his holdings in India’s largest airline by market share, leveraging its current financial health and market valuation to optimize returns.