Thursday, September 22, 2016

A low key AGM for a high flying company like IndiGo

New Delhi: True to its low cost model, IndiGo- the country’s most profitable airline kept its 13th Annual General Meeting- the first after its public listing a low key affair. With barely 200 shareholders present, the company’s meeting was completed in less than an hour with president Aditya Ghosh being lauded for the company’s consistent profitable performance. “All shareholders were pleased with Ghosh, he is the perfect man to drive the company’s strategy,” said Abhimanyu Bhatia, who holds 400 shares in the company. However, both the promoters Rahul Bhatia and Rakesh Gangwal did not participate in the AGM. Bhatia along with close friend Gangwal went on to build IndiGo, which is currently worth around Rs 35,000 crore- multiple times more than the $60 million that the promoter’s initial investment.

InterGlobe, the airline’s holding company listed in the markets in a Rs.3,130 crore initial public offering last year — the biggest initial share sale by an Indian company since 2012 — on demand led by financial institutions and rich individuals.

According to people who attended the meeting the board faced a wide range of questions from the prospects of the A320 neo aircrafts to the company’s response to the regional connectivity scheme. “The director replied to most of the queries, on the delay on acquiring the A320 neo, he mentioned that there have been discussions with both manufacturer Airbus and engine maker Pratt & Whitney and the airline will end the year with 136 aircrafts as was mentioned earlier,” said a shareholder who came down from Pune to attend the meeting. According to him Ghosh announced that the airline has received its 8th A320 neo yesterday which takes its total fleet size to 115.

In its earnings call for Q4 of 2015-16, Ghosh said that it was weighing options of switching to CFM engines as Pratt’s faced an issue which delays the correct operating temperature.

The board of directors also faced questions from unhappy shareholders on the “paltry sum of dividend” given by the company. “We are quite unhappy with the low quantum of divided, even after remaining profitable for subsequent quarters,” a shareholder said. Ghosh is understood to have saying that the amount of dividend was in line with the company’s performance of the company in the last fiscal. For the year 2015-16 the company had recommended a dividend of Rs 15 per share.
21/09/16 Arindam Majumder/Business Standard
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