MUMBAI:
IndiGo hopes to raise $534 million by issuing shares to try and boost liquidity after the
coronavirus pandemic
sparked record losses and job cuts.
Airlines worldwide have reported steep falls in revenue because of a slump in demand as governments impose sweeping travel restrictions to battle COVID-19.
IndiGo last month reported its highest-ever loss of Rs 2,849 crore ($382 million) for the quarter ending June 30, and said it would cut 10 per cent of its staff.
The carrier's
parent firm Interglobe Aviation
announced late Monday that its board had approved the issue of shares to raise Rs 4,000 crore ($534 million).
The pandemic has dealt a sharp blow to the aviation industry, which had seen tremendous growth in recent years.
Adding to the gloom, industry body IATA warned last month that global air traffic would not return to pre-pandemic levels until 2024, a year later than previously forecast.
Other budget carriers GoAir and SpiceJet are also struggling to manage their finances and are renegotiating contracts with aircraft owners.
The
IndiGo share issue
decision follows its announcement in June to slash expenditure by Rs 4,000 crore and cut costs by quickly returning older planes to leasing firms.
Shares in Interglobe Aviation were down over one per cent in Mumbai on Tuesday following the equity announcement.
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