Indian Budget Airline Go Air Rebrands to Go First, Files for IPO to Raise Over $490 Million

By Adriaan Brits Friday, May 14, 2021

Go Airlines India, a low-cost company owned by the Wadia Group, has filed for an initial public offering (IPO). The airline business is seeking approval from India’s market regulators as it looks to raise more than $490 million through the IPO.

Street sign that says, "IPO just ahead."

Rebranding and IPO

A day after the company changed its name from “Go Airlines” to “Go First,” the budget airline filed for the IPO as it looks to raise fresh business funds and have its shares traded in the open market. ICICI Securities Ltd., Citi, and Morgan Stanley will manage the IPO.

The company is looking to raise ₹36 billion ($491.1 million) and may consider conducting a pre IPO share sell to raise ₹15 billion ($204.63 million), the company said today. Go First may offer a decreased number of shares in the IPO, in case it decides to sell a portion of shares before the IPO takes place.

Go First is the second biggest business customer for the European airline maker Airbus SE. The company has decided to raise funds at a time when the COVID-19 pandemic continues to hamper the recovery of the airline industry. The second COVID-19 wave, and the biggest one so far in terms of the number of infections and deaths reported, has yielded renewed lockdowns and delays in the normalization of travel.

Go First’s IPO comes after IndiGo, the country’s biggest low-cost airline, decided to raise ₹30 billion ($409.2 million) to boost its balance sheet amid delays in the air travel recovery. A year ago, Go Airlines asked 90% of its staff to go on leave without pay, according to Bloomberg.

The company is looking to use the raised business funds to repay its debt and dues to Indian Oil Corporation for the supply of fuel. In its IPO prospectus, the airline company highlighted its low-cost business model as a competitive advantage. Pre-pandemic, the company said it witnessed a surge in the number of passenger numbers from 10.8 million in 2018 to 16.2 million in 2020.

The company’s fleet consists of Airbus-produced narrowbody planes, mostly A320 models. As of the end of March, the airline operated 55 aircraft while it plans to increase its fleet to 60 by the end of the current financial year.

In March, the company hired Ben Baldanza, the former long-time chief executive of Spirit Airlines, as its vice-chairman to further develop its ultra low-cost carrier business model.

“Our company is now poised for its next phase of growth as a ULCC. Towards achieving this objective, we have re-branded our airline to ’Go First.’ We believe that our new brand will better reflect our customer acquisition strategy of targeting young Indian leisure and MSME travelers, which is our largest customer base,” the company said.

Kaushik Khona, CEO of the company, noted that the rebranding campaign “reflects our confidence in the brighter tomorrow,” as the airline business sees opportunities ahead.

About the Author

Headshot for author Adriaan Brits
As an analyst of global affairs, Adriaan has an MSC from Oxford, with diverse interests in the digital economy, entertainment, and business. He is a specialist trainer in Advanced Analytics & Media.

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