Friday, September 04, 2020

IndiGo gets new tailwind on its wings

The government on Wednesday raised the limit of domestic passenger ights that airlines can operate to 60 per cent of the pre-Covid levels from the earlier limit of 45 per cent.
This is expected to help InterGlobe Aviation , which provides services under the brand Indigo, given its market share of 56 per cent. At a time when its peers are striving for funds to survive, Indigo had a total cash balance of Rs 18,449.8 crore at the end of June 2020. Besides, the airline announced in August that it will raise Rs 4,000 crore through qualied institutional placement (QIP).
It also plans to raise Rs 1,956 crore through sale and leaseback of its aircraft. In times of uncertain travel demand, the ability of an airline to raise funds is a big positive. In addition, the airline expected to improve the capacity utilisation to 60-70 per cent by the December quarter from under 33 per cent in the June quarter.
04/09/20 Rajesh Naidu/Economic Times
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