IndiGo seeks 57% higher borrowing limit to fund fleet expansion
New Delhi/Mumbai: InterGlobe Aviation Ltd, which operates Indiaās largest airline IndiGo, is seeking shareholder approval to raise its borrowing limit by 57% to ā¹110,000 crore
New Delhi/Mumbai: InterGlobe Aviation Ltd, which operates Indiaās largest airline IndiGo, is seeking shareholder approval to raise its borrowing limit by 57% to ā¹110,000 crore, from the existing ā¹70,000 crore, as the airline prepares to finance an aggressive fleet expansion. The airline expects to exhaust its existing borrowing limit in FY27 and seeks an additional borrowing capacity of ā¹40,000 crore, which it is likely to use by the first half of FY29, IndiGo said in the shareholder notice to its annual general meeting on Tuesday. About 75% of the incremental borrowing capacity is expected to be used to finance aircraft through long-term finance leases, with the balance earmarked for capital expenditure and working capital. Also Read | IndiGo faces rough weather in Q1, hit by skyrocketing fuel prices The move comes as IndiGo works through one of the largest aircraft expansion programmes in global aviation. The airline had a fleet of 441 aircraft as of 31 March 2026, while its order book stood at about 900 aircraft, with deliveries spread through 2035. IndiGo is also targeting nearly 200 million passengers annually, around 3,000 daily departures and a fleet of more than 550 aircraft by 2030. āIn order to support the steady stream of planned aircraft deliveries through diversified sources of financing and working capital requirements in the coming years,ā the company expects to utilize its existing borrowing limit during FY27, it said.
The airline had already received sanctioned credit facilities of about ā¹66,150 crore by 31 March, equivalent to 95% of its existing borrowing limit. Of this, ā¹46,190 crore had been utilized, including about ā¹28,850 crore in finance lease liabilities, ā¹1,810 crore in working capital borrowings and ā¹15,540 crore in non-fund-based facilities. āIndiGo is looking to have 40% of its fleet under owned and financed leases. That is why it is looking to raise borrowing limits and fund the aircraft additions,ā said Gagan Dixit, senior vice president - oil and gas, and aviation, at brokerage firm Elara Securities. āIt is well capitalized and does not require borrowings for day-to-day operations,ā he added. Also Read | Air India loses altitude, IndiGo soars on capacity addition IndiGo is not alone in seeking greater borrowing headroom as Indian airlines step up fleet expansion. Tata Groupās low-cost carrier Air India Express raised its borrowing limit by 25% to ā¹17,500 crore, while Akasa Air more than tripled its borrowing limit to ā¹3,950 crore. Incidentally, the proposed borrowing limit comes at a time when IndiGo is facing a combination of higher costs, geopolitical disruptions and a significant management transition. Managing director Rahul Bhatia has highlighted these challenges in his address to shareholders in the annual report. āRecent global developments have reinforced the interconnected nature of economies and highlighted the vulnerabilities that impact industries dependent on international trade, energy markets, and global mobility,ā Bhatia told shareholders in the annual report.
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