The shares of InterGlobe Aviation, the parent company of IndiGo Airlines, fell 3% on Thursday, reaching a low of Rs 4,714.90 for the day. This was due to reports that Rakesh Gangwal, the co-founder, had been reported to have sold 2.3 crore shares in a large block transaction worth over Rs 11,000 crore.
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Specifics of the Block Deal
About 2.3 crore shares were sold in the deal, which had a value of Rs 11,000 crore, at a floor price of Rs 4,760 a share. This move is believed to be a part of promoter and co-founder Rakesh Gangwal's plan to accomplish a nearly full exit from the business.
IndiGo shares saw a minor decrease after the stake sale; at 9:22 AM on the NSE, they were trading at Rs 4,838, down roughly 0.45% from the previous close. It was not possible to instantly confirm who the actual buyers and sellers of the shares were.
Future Goals and Lock-In Time for Gangwal
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According to media sources dated August 28, Gangwal intended to sell shares valued at Rs 10,300 crore, or around 5.8% of the company at the discounted share price, in order to further lower his position. Before Gangwal can proceed with another tranche of the sale, a 150-day lock-in period will begin with this stake sale.
His decision falls into a larger plan to gradually sell his IndiGo shares once he leaves the InterGlobe Aviation board of directors in February 2022. Over a five-year period, Gangwal had declared his aim to reduce his ownership of the low-cost airline.
Present Investment and Prior Sales
The promoter group supported by Gangwal controlled 19.38% of InterGlobe Aviation at the end of the June quarter, while Gangwal himself owned 5.89% of the business. By June 2024, the promoter group's ownership had dropped to 19.38% from 36.7% in 2019.
Together with Gangwal's personal 5.89% ownership, this figure also includes a 13.49% investment owned by the Chinkerpoo Family Trust, which is run by Shobha Gangwal and JP Morgan Trust Company of Delaware.
The Gangwal family sold 2.8% of the airline for Rs 2,000 crore in September 2022, marking the first phase of the share sale.
A second sale of an extra 4% for Rs 2,900 crore took place in February 2023. Rakesh Gangwal's wife Shobha sold her approximately 3% share in InterGlobe Aviation in August 2023 for a sum of Rs 2,801.8 crore.
Performance of IndiGo Stock Over the Past Year
IndiGo shares have shown positive returns in terms of stock performance across a number of time periods. The company has returned a respectable 6.98% over the last month, demonstrating its growth potential and stability. Results during the last six months have been even more outstanding, showing a steady rising trend with a large gain of 50.54%.
IndiGo's stock has increased by 59.68% so far this year, supporting the company's good momentum for the current fiscal year. In the big picture, the stock has shown a strong return of more than 91.20% over the past 12 months, highlighting its steady growth and investor appeal.
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