Shares of IndiGo were down on Thursday amid reports that the company’s promoter was looking to dump part of their stake in India’s top carrier.

What Happened: IndiGo co-founder and promoter, Rakesh Gangwal, is reportedly gearing up to sell an equity stake valued at a whopping ₹10,300 crore in the parent company, InterGlobe Aviation, CNBC-TV18 reported, citing sources — significantly higher than the previously reported ₹6,750 crore on August 28.

The Gangwal family has reportedly ramped up the size of the planned block deal, with back-of-the-envelope calculations suggesting they may offload about 5.5% of their equity stake. The block deals are expected to be executed at an indicative price of ₹4,593 per share, a 5.5% discount to the previous closing price.

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Lon-Term Plans: As of June 2024, Rakesh Gangwal holds 5.89% of IndiGo, while his wife Shobha Gangwal and JPMorgan Trust of Delaware control an additional 13.49%, bringing their combined stake to 19.38%.

This stake sale is part of the Gangwal family’s broader plan to gradually reduce their holdings in the airline. Rakesh Gangwal stepped down from the board of directors at InterGlobe Aviation in February 2022, announcing his intention to scale back his stake in the airline over the next five years.

Jefferies recently upgraded the stock to a “buy” and raised the target price to ₹5,225 per share, citing the airline’s robust operating performance, which has consistently exceeded expectations over the past 12-18 months.

Price Action: IndiGo’s share price was down 0.64% at ₹4,828.95 in early trade on Thursday, recovering slightly from a steeper dip at open.

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