According to a Bloomberg article, domestic carrier Go First plans to raise $36 billion through an initial public offering in July as air travel recovers from the ongoing Covid-19 outbreak.
The IPO will be critical for India's debt-ridden No. 2 airline, which is losing money and plans to use the profits from the share sale to pay off debt and other obligations to creditors such as Indian Oil Corp. According to the draught preliminary prospectus, Go First, formerly known as GoAir, had commitments of approximately $81.6 billion as of April 2021. The sale of Go First's stock comes as air travel in the South Asian country is rebounding, fueled by pent-up demand as people recover from one of the virus's deadliest epidemics.
Before Covid-19, India was the world's fastest-growing major aviation market, with local traffic expected to surpass pre-pandemic levels of 415,000 daily flyers within a year. Indian carriers are also increasing capacity in order to capitalise on the resumption of international flights. When Tata Sons Pvt merges its airlines – Vistara, Air India Ltd, and AirAsia India – Go First, which ranks second behind Indigo, expects to lose its No. 2 position. According to the report, Go First expects to break even this quarter, thanks to an increase in leisure travel demand.
To capitalise on the rebound in travel, Go First is expected to begin adding 10 new Airbus SE A320neo aircraft in August, bringing its total fleet to 62 by March 2023. The airline has placed an order for 144 A320neo jets. The new aircraft will be used by Go First to enhance flight frequency on routes to Abu Dhabi and Kuwait, as well as to expand its Southeast Asian destinations to include Vietnam, Indonesia, and Cambodia.
Girish Advani was named Chief Commercial Officer of Go First last month. Advani joins the airline from the Wadia Group, where he was Vice President of Corporate Affairs. He took over from Praveen Iyer, who left the company in September 2020 after only seven months on the job.Also Read : Best SIP to invest in 2022 in India - Know them here!