Thursday, October 29, 2015

Jet Airways Group turns to Q2 profit

HE HINDU,29OCT2015

Jet Airways Group reported net profit of Rs.83 crore for the second quarter ended September 30, as compared to net loss of Rs.42.8 crore in the same period last year.
This is the airline group’s second consecutive profitable quarter in the current financial year and a profitable second quarter after a gap of eight years, Jet Airways, in which Etihad Airways owns 24 per cent stake, said.
Jet Airways group comprises Jet Airways and JetLite whose merger process with the former is on.
On a standalone basis, Jet Airways reported net profit of Rs.87.59 crore in the second quarter against profit of Rs.70 crore a year earlier.
“The Indian domestic aviation market is witnessing robust growth with traffic growing by 20 per cent. Jet Airways is committed to contributing to this growth by providing enhanced connectivity and a full-service travel experience to our guests. Our financial performance in the second quarter clearly demonstrates that our efforts are showing positive results,” Naresh Goyal, Chairman, Jet Airways said in a statement.
Jet Group’s total revenue for the second quarter increased by 8.1 per cent to Rs.5,504 crore from Rs.5,092 crore in the same period last year. Passenger revenues rose by 9.5 per cent to Rs.4,682 crore from Rs.4,277 crore in the same period last year.
Jet Group’s domestic capacity grew by 16.6 per cent last quarter while passenger numbers grew 34.5 per cent which were much higher than the industry growth, the airline said.
At the same time, in the international business the airline registered a 6.6 per cent growth in capacity and a 9.7 per cent growth in passengers.
“This improvement is largely the result of optimizing the network to enable tighter integration between domestic and international networks, enhanced synergies with partner carriers and improved operational performance,” Jet Airways said.
“It is encouraging to report a profit in the second quarter, which is traditionally a lean season for the aviation sector,” Cramer Ball, Chief Executive Officer, Jet Airways said.
“While the robust competition in the Indian aviation sector continues to put pressure on yields, we have continued to make progress by focusing on improving operational efficiency,” he added.
“The growth in passengers flown and the improved aircraft utilisation have been significant contributors to the performance in the second quarter,” Mr. Ball said.

Tuesday, October 27, 2015

InterGlobe Aviation IPO hits market; issue subscribed 33%


THE HINDU,27OCT2015

The Rs. 3,018-crore initial public offer (IPO) of IndiGo’s parent InterGlobe Aviation was subscribed 33 per cent till noon on the first day of the issue.
The much-awaited IPO had received bids for 99,26,190 shares against the total issue size of 3,01,22,088 shares, data available with the NSE till 1200 hrs showed.
The portion reserved for qualified institutional buyers (QIB) was over-subscribed 1.14 times, sources said.
However, retail and high net worth individual (HNI) category saw slow demand.
InterGlobe Aviation has already raised Rs. 832 crore from anchor investors by allotting shares at the upper price band of Rs. 765 apiece.
InterGlobe hit the capital markets to raise Rs. 3,018 crore through the initial public offering, the biggest in nearly three years. The price band for the offer has been fixed at Rs. 700-765 per share.
The company had reduced its initial share sale size to a little over Rs. 3,000 crore last week, with three of the promoters deciding to sell less number of shares than proposed earlier.
The offer comprises fresh issue of shares worth Rs. 1,272.2 crore and the revised Offer for Sale (OFS) size that would be about Rs. 1,746 crore. Together, the share sale can rake in up to Rs. 3,018.2 crore.
The IPO would conclude on October 29.
Barclays Bank PLC, Kotak Mahindra Capital Company Limited and UBS Securities India are managing the issue.
IndiGo has a fleet of 98 aircrafts and about 75 of them are operating on lease — a business model which has helped it lower costs.

Tuesday, October 20, 2015

IndiGo lowers IPO size to Rs 3,018 crore

THE HINDU,20OCT2015

IndiGo’s parent InterGlobe Aviation has reduced its initial share sale size to a little over Rs 3,000 crore, with three of the promoters deciding to sell less number of shares than proposed earlier.
The operator of the profitable no-frills carrier would be hitting the capital market on October 27 and the price band for the offer has been fixed at Rs 700-765.
With three promoters — Rakesh Gangwal, Shobha Gangwal and Chinkerpoo Family Trust — deciding to offload less number of shares in the company, the IPO size has come down by Rs 250 crore to Rs 3,018 crore. On the basis of earlier proposal, the initial share sale could have fetched up to Rs 3,268 crore.
These figures are based on the upper price band of Rs 765 apiece.
InterGlobe on Tuesday said the size of Offer for Sale by the promoters has been reduced to 22.82 million as against earlier plan to offload 26.11 million.
Rakesh Gangwal would now be selling only 2.74 million shares, lower than earlier plan to offload 3.76 million.
Another promoter Shobha Gangwal would sell only 1.17 million shares, revising down from 2.23 million shares.
Further, Chinkerpoo Family Trust (Trustees are Shobha Gangwal and JP Morgan Trust Company of Delaware) has reduced the number of shares to be sold to 2.42 million from the previous plan to offload 3.64 million shares, according to a public notice.
Now, the IPO comprises fresh issue of shares worth Rs 1,272.2 crore and the revised OFS size that would be about Rs 1,746 crore. Together, the share sale can rake in up to Rs 3,018.2 crore.
InterGlobe, the holding company of IndiGo, on Monday said it would retire Rs 1,166 crore out of its Rs 3,912—crore debt from the IPO proceeds.
Recently, the company declared an interim dividend of Rs 1,500 crore to the promoters.
When asked about hefty payouts the promoters have been getting all these while, the company’s President Aditya Ghosh had said: “As a manager my mandate is to keep my customers happy, my employees happy and also investors/shareholders. I have been doing as a private company and will continue to do so as public company going forward.”
IndiGo’s IPO would close on October 29.
The much—awaited offer is also seen as a test case for revival of big—ticket sales in the primary market.

Monday, October 19, 2015

IndiGo to retire Rs 1,166cr debt from IPO proceeds

THE HINDU,19OCT2015

Set to hit the capital markets with Rs 3,268 crore IPO next week, InterGlobe Aviation on Monday said it will retire nearly one-third of its total debt of Rs 3,912 crore from the share sale proceeds.
InterGlobe Aviation is the holding company of IndiGo airline. The company said it will retire Rs 1,166 crore out of its Rs 3,912 crore debt from the IPO proceeds.
Stating that the airline has not a single penny in working capital or non-aircraft purchase related debt, company President Aditya Ghosh said the entire Rs 3,912-crore debt it has is related to aircraft purchases. Out of its nine years of existence, it has been profitable in seven years, he claimed.
“For us the company turning a negative net worth of Rs 139 crore is a non-event,” Ghosh said.
It happened on June 30, when the company declared an interim dividend of Rs 1,500 crore to the promoters. Since then the net worth has turned positive and it remains so. As of now “we have a cash balance of over Rs 3,500 crore on our books”, he said.
“We had to report that we had negative net worth for disclosure purposes as we happened to file our IPO papers with the Sebi on June 30. But let me repeat, that is a non-event as far as IndiGo and InterGlobe are concerned,” Ghosh said while formally announcing the IPO.
When asked about hefty payouts the promoters have been getting all these while, he said, “As a manager my mandate is to keep my customers happy, my employees happy and also investors/shareholders. I have been doing as a private company and will continue to do so as public company going forward.”
Ghosh said the company will launch its Rs 3,268-crore public issue, the first from the airline sector after the Spicejet IPO, on October 27 which will remain open till October 29. The Rs 10-share has been priced at Rs 700-765.
The public issue includes a share premium consisting of a fresh issue aggregating up to Rs 1,272.2 crore and offer for sale of up to 26,112,000 shares, comprising 3,290,419 shares by InterGlobe Enterprises; 3,006,000 shares by Rahul Bhatia who will retain just 40,000-share post-issue thus practically exiting the airline’s direct holding.
When asked about the public perception about Bhatia, who has been the face of the airline from day one, Ghosh said that even after the issue both the key promoters (Bhatia and Rakesh Gangwal) will hold over 47 percent each in the holding company, which in turn own the airline.”