The shares of InterGlobe Aviation Ltd (IGAL), the parent of IndiGo, plummeted over 11 per cent on Wednesday, wiping out ₹6,423 crore from its market valuation following a spat between its co-promoters over corporate governance issues.

The scrip tanked 10.73 per cent to close at ₹1,397.75 on the BSE. Intra day, it had plunged 17.54 per cent to ₹1,291.

The co-promoters of IndiGo, Rakesh Gangwal and Rahul Bhatia, have been engaged in a war of words over governance issues.

InterGlobe clarifies

IGAL on Wednesday clarified that the existence of related party transactions (RPTs) was disclosed at the time of its IPO in 2015.

Gangwal, in his submission to SEBI on Tuesday, had made several allegations about the RPTs.

“Post the IPO, many of the RPTs have ceased to exist while others have been renewed on an arms’ length basis as part of the normal course of business,” the airline said in a media statement.

Read more:IndiGo co-founders feud over governance lapses

The statement added that InterGlobe Enterprises (IGE) and its group entities had ensured that none of them took advantage of the RPTs.

IGE and its founder (Bhatia and family) are co-promoters of IndiGo along with Gangwal.

CEO reassures staff

Meanwhile, IndiGo CEO Ronojoy Dutta told employees that the mission, direction and growth strategy of the airline remain “unchanged and are firmly in place”.

“The issues between them (co-promoters) will eventually get sorted out but I want to stress that these issues have nothing to do with the airline and its functioning,” Dutta said, adding that “absolutely” nothing has changed for any of them.

 

 

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