Indian budget carrier IndiGo is to invest $820 million into a wholly-owned subsidiary as part of a strategy to increase aircraft ownership.
The capital investment – which has received board approval – involves the subsidiary InterGlobe Aviation Financial Services.
Funds will be “primarily deployed” towards acquisition of aviation assets, says IndiGo, “thereby enabling ownership of aircraft”.
“IndiGo has historically maintained a fleet structure predominantly reliant on operating leases,” it states.
In recent years, the organisation has undertaken a strategic development towards a more balanced ownership structure and diversified forms of financing.”
It says the investment decision reflects a “commitment to prudent capital allocation”.
The fund infusion is expected to be conducted in multiple tranches over the course of fiscal 2025-26.
IndiGo will subscribe to equity shares amounting to $770 million as part of the investment, while the remaining $50 million will be achieved through a subscription to optionally convertible redeemable preference shares.
Over 400 aircraft are in the IndiGo fleet – a mix of Airbus single-aisle jets and ATR turboprops – and the airline has also ordered Airbus A350-900s.
