Go Airlines, which now has renamed itself as 'Go First', has filed preliminary papers for a Rs 3,600 crore initial share sale. This Wadia group-backed budget carrier has been operational for 15 years, and the proceeds from the Initial Public Offer (IPO) will be used to pay off debt. According to the draft red herring prospectus, the airline is looking to collect up to Rs 3,600 crore through the selling of shares (DRHP).
The funds will be used to "prepayment or scheduled repayment of all or a portion of certain outstanding borrowings," as well as to substitute letter of credits given to certain aircraft lessors as a means of obtaining lease rental payments and potential aircraft repairs with cash deposits. According to the DRHP, the carrier will also look to reimburse Indian Oil Corporation Ltd for fuel supplied to it, in part or in full, and use the proceeds for general corporate purposes."Our company expects to receive the benefits of listing of the equity shares, including to enhance our visibility and our brand image among our existing and potential customers and to create a public market for our equity shares in India," it noted.
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The airline incurred a Rs 1,270.74 crore loss in the financial year ending March 2020, while total revenue was Rs 7,258.01 crore. The ultra-low-cost carrier (ULCC) model is now its primary target. Indigo and SpiceJet are the only two operating scheduled carriers currently listed on domestic stock markets. Go First CEO Kaushik Khona said the airline has remained resilient throughout the difficult times of the past 15 months after announcing the rebranding on Thursday. He said that "Even as the times continue to be extraordinary, Go First sees opportunities ahead. This rebranding reflects our confidence in the brighter tomorrow,".
