IndiGo co-founder Rakesh Gangwal further reduces stake in InterGlobe Aviation

This sale follows previous divestments by Gangwal and his family, indicating a gradual reduction in their shareholding in the company.

On Monday, Gangwal sold 22.5 million shares worth ₹6,785.7 crore in InterGlobe Aviation at an average price of ₹3,015.88 per share. Following this transaction, Gangwal’s stake in the company has reduced to 6%, bringing down the promoter group’s holding in InterGlobe Aviation to 57.3%.

On 7 March, Mint had reported, based on a term sheet, that Gangwal planned to sell up to 12.75 million shares, or 3.3% of his stake in InterGlobe Aviation, through a block deal.

“In February 2022, Rakesh Gangwal stepped down from the InterGlobe Aviation board as a non-executive, non-independent director and had said that he would sell his entire holding in IndiGo over a period of five years by selling its stake gradually via multiple block deals,” said Atul Parakh, chief executive at online investment and trading firm Bigul.

“This could benefit investors from potential future growth in the company’s share price as the fundamentals of the company stand strong with its strong market position, operational efficiency, fleet expansion plans, favourable industry dynamics, attractive valuation, dividend payouts, and robust corporate governance,” he added.

On the other side, Morgan Stanley Asia bought 2.1 million shares of InterGlobe Aviation at ₹3,015.10 apiece.

Investment banking giants Morgan Stanley, JP Morgan, and Goldman Sachs managed the sale on behalf of Gangwal.

Gangwal and his family sold a 2.8% stake in InterGlobe Aviation for ₹2,000 crore in September 2022, and in February last year, offloaded another 4% stake for ₹2,900 crore.

Following that, in August, Gangwal’s wife, Shobha Gangwal, sold her entire holding of nearly 3% in InterGlobe Aviation through a bulk deal.

The latest block deal on Monday sent IndiGo’s stock soaring on the National Stock Exchange. The company’s share price surged by as much as 5% to ₹3,262 apiece before eventually ending the day’s trading at ₹3,218.55 apiece.

IndiGo’s stock has witnessed a significant increase of 70.3% over the past year, outpacing the benchmark Sensex index’s more modest gain of 24.3% in the same period.

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Published: 11 Mar 2024, 07:05 PM IST