Analysis: Impact of Rakesh Gangwal’s $795 Million Block Sale on IndiGo Share Prices
IndiGo Share Price: Rakesh Gangwal to Cash In with Block Deal as Stock Trades Near Record High.
IndiGo’s co-founder, Rakesh Gangwal, aims to raise up to $795 million by selling his stock, making it the largest block sale in India since 2019. Gangwal is offering as many as 22.5 million shares of InterGlobe Aviation Ltd., the parent company of IndiGo, at a floor price of 2,925 rupees each.
InterGlobe Aviation shares dropped by 3 percent in early trading on March 11 following a block deal where a 6.7 percent stake was sold, amounting to ₹7,823 crore.
What we know about the block sale?
Bloomberg reported that the number of shares for sale was raised from the initially expected 12.75 million. With the stock trading near a record high, Rakesh Gangwal will be cashing in through the block deal.
Bloomberg reported that the number of shares for sale was raised from the initially expected 12.75 million. With the stock trading near a record high, Rakesh Gangwal will be cashing in through the block deal.
Data indicates that investment banks Morgan Stanley, JP Morgan, and Goldman Sachs provided advisory services to Rakesh Gangwal. Together with his family trust, they hold approximately 25 percent ownership of InterGlobe Aviation.
In February 2022, Rakesh Gangwal resigned and revealed intentions to reduce his family’s ownership. During that month, he divested a 4 percent stake for ₹2,900 crore and later sold an additional 2.8 percent stake valued at ₹2,000 crore in September. Furthermore, his family disposed of a stake worth $450 million in August.
IndiGo airline performance
During the December quarter, IndiGo witnessed a significant surge in net profit, registering a 111 percent increase to ₹2,998.12 crore compared to ₹1,422.6 crore recorded in the corresponding period of the previous year. Additionally, the airline experienced a 30 percent rise in revenue from operations, amounting to ₹19,452.15 crore.
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