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GoAirline Set To Launch Its IPO; Expects SEBI Clearance Soon

The airline company has the Wadia Group listed as one of its promoters. This IPO will be managed by Morgan Stanley and Citigroup

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Go Airlines is set to launch its initial public offering (IPO) in August, 2021 and expects the Securities and Exchange Board of India (SEBI) to clear the proposal by July 31, 2021. While the airline has the Wadia Group listed as one of its promoters, this IPO will be managed jointly by Morgan Stanley and Citigroup. 

The airlines filed its draft red herring prospectus (DRHP) with SEBI earlier this year in May, with the goal of raising Rs 3,600 crores. Go Airlines intends to use almost 55 per cent of the IPO proceeds to pay off debt as well Rs 240 crore in credit owed to IOC. This move comes at a time when airlines are struggling to arrange refund for passengers amidst pandemic induced ban on travel.

In September 2020, the Supreme Court had directed all airlines to immediately make full refunds for all cancelled flights between 25 March and 24 May. This was a period of countrywide lockdown imposed by the government. The Supreme Court said all refunds were to be made by 31 March 2021. While most airlines, including GoAir claimed that they have completed the entire refund process, passengers have a different story to tell. In this light, launching an IPO could be a positive move to restart cashflow and passify all stakeholders on board. 

Go Airlines is also planning to increase its revenues from 7 per cent to 20 per cent, while it is looking to add 10 more Airbus Neo aircrafts to its fleet. By 2024, GoAir plans to have its own fleet of plains.  

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