The low-cost carrier Indigo Airlineswhich has seen two of its largest shareholder-promoters - Rahul Bhatia and Rakesh Gangwal - at loggerheads, could see some resolution in the shareholders’ meeting on December 30.
Bhatia and Gangwal, together holding 74.44 per cent of the paid-up equity share capital, have called an extraordinary general meeting (EGM) for amending the Articles of Association (AoA) of the company that will lead to the removal of restrictions on the transfer of promoter shares.
If the resolution is accepted, it would end the dispute between the owners, say sources. It would also make way for the exit of one of the promoters or allow any of them to sell or transfer shares to a third party without giving each other a notice.
However, when the exit happens and which promoter would offload his shares is a matter of market speculation. None of the two promoters have publicly said that they want an exit.
Brokers and aviation sector observers say, Gangwal is most likely to dilute stake.
The Spat
The spat between IndiGo promoters began after Gangwal ccused Bhatia of indulging in “questionable” related-party transactions between InterGlobe Aviation and Bhatia Group entities, some years ago.
Since then the two have had several disagreements on issues surrounding the airlines, their strategies, etc.
Outlook
Meanwhile, the aviation industry in India is still reeling from the effects of Covid. While there is a buzz in the market about new airlines like Akasha, Jet Airways 2.0, airlines' are worried about the threat of rising Omicron cases impacting forward bookings.
IndiGo is experiencing a slowdown in future bookings due to the Omicron variant of Covid-19, said CEO Ronojoy Dutta.
"Omicron is, of course, a major uncertainty for the travel industry. While the impact of Omicron has been modest so far, our future bookings are experiencing a slowdown and we cannot predict with certainty when the trend will reverse again,” he said.