Covid impact: IndiGo to raise upto Rs 3,000 crore through QIP

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NEW DELHI: To tide over Covid’s debilitating impact, IndiGo — India’s only airline with cash reserves — has decided to raise upto Rs 3,000 crore through QIP.
In a regulatory filing with BSE on Monday, the airline said its board of directors have “approved raising of funds for an aggregate amount not exceeding Rs 3,000 crore through an issue of equity shares by way of a qualified institutions placement.”
The ongoing Covid wave has hit travel very badly with both domestic and international traffic nosediving. Close to 20 countries have imposed travel restrictions from India like flight suspensions or going in for stricter entry norms. The requirement of Covid negative test reports by many states has hit domestic travel also.
Scheduled domestic flights restarted on May 25, 2020, after a two-month suspension with about 30,000 passengers travelling (across the country) on Day One. This number kept growing as things improved. March 27, 2021, for instance, saw 2.8 lakh domestic passengers (across the country) on 2,336 flights. But ongoing Covid wave saw the number of domestic flyers decline to 79,000 on May 8, according to aviation ministry’s tweets.
A majority of Indian carriers are cash-strapped and struggling to survive. If this ongoing torrid Covid wave does not end soon, Indian aviation space could see some more casualties like Kingfisher and Jet not so long back.
“IndiGo is among the few airlines that can still raise funds due to its financial performance over the years. The Tata Group JVs are backed by the salt-to-satellite conglomerate and are funded by it. Air India is on the selling block. GoAir is backed by the cash-rich Wadia Group. Other standalone airlines with weak balance sheets and no deep-pocket-promoter/s are really struggling to survive,” said aviation insiders.

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