GoAir has been thinking of launching an IPO since 2017, but has not been successful so far. However, due to the tremendous response received by the IPO in the primary market of the country recently, the company has revived its plan to launch the IPO once again. According to the news published in ET, GoAir has appointed Citigroup, ICICI Securities and Morgan Stanley as their investment bankers for this IPO. Sources from the company said that the company is trying to reduce its debt and fund raising for the long term. This is the time to launch an IPO for this.
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Goair was in debt during the Coronavirus era
GoAir’s business has been severely affected by the Coronavirus epidemic. Due to this, the company is struggling to meet its operational cost. The debt burden on the company is also increasing. The company had a total debt of Rs 1819 crore as of March 31, 2019, which has now increased significantly. Whereas, the company’s net profit in the last financial year was Rs 123 crore and revenue was Rs 6262 crore. Also, bank funding of airlines companies has also been affected due to Kovid, which has compounded the problem. Let us tell you that the Wadia Group operates business companies such as Bombay Dyeing, Bombay Bumrah, Britannia Biscuit, National Peroxide and Bombay Reality with GoAir.
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8.6% stake in domestic passenger traffic
GoAir has 300 flights a day for 27 destinations and the company has 8.6% stake in domestic passenger traffic. If GoAir’s IPO comes, then the valuation of the company will be less than SpiceJet. In the past 6 months, the stock of Indigo-owned company InterGlobe Aviation has risen by 80%. At the same time, SpiceJet shares have risen 90% during this period.