IndiGo is the fairest of them all, and more so after the covid-19 pandemic

Many companies are scrambling to raise funds to offset the blow to cash flows caused by the pandemic. InterGlobe Aviation Ltd was in the race too, but the company has now said that the probability of raising funds through a qualified institutional placement (QIP) are now 50%. InterGlobe runs IndiGo, India’s largest airline.

At its annual general meeting last week, Ronojoy Dutta, the airline’s chief executive, said IndiGo would prefer to see its revenues increase even as QIP is an option. It has clearly helped that the government recently allowed an increase in capacity.

But another key reason IndiGo may defer or cancel the QIP is that it already has sufficient cash in hand—free cash of ₹7,527 crore and restricted cash of ₹10,922 crore at end-June. It has announced plans to cut costs and improve liquidity.