Go Airlines, which has rebranded itself as Go First, has filed preliminary papers for an initial public offer (IPO) worth Rs 3,600 crore. The proceeds of the IPO will be mainly used to repay dues amid the aviation industry facing strong headwinds due to the Coronavirus pandemic. 

After taking to the skies 15 years ago, the Wadia Group-promoted budget carrier, which has ambitious expansion plans, is looking to mop up the amount through issue of fresh equity shares. It also has plans to raise up to Rs 1,500 crore by way of a pre-IPO placement. 

Once the shares get listed, Go Airlines India will be the third operational scheduled carrier after SpiceJet and IndiGo to trade on Indian bourses. 

In a release on Friday, Go Airlines said it had filed the Draft Red Herring Prospectus (DRHP) for the IPO to raise up to Rs 3,600 crore through issue of fresh equity shares. “We expect competitive conditions in our industry to intensify further as new entrants emerge and as existing competitors seek to extend their operations and flight frequencies over routes that we operate,” the airline has said in the DRHP. It also noted that the aviation industry faced significant business challenges as a result of the COVID pandemic. 

In the financial year ended March 2020, the airline had a loss of Rs 1,270.74 crore, while total income stood at Rs 7,258.01 crore. “Our company expects to receive the benefits of listing of the equity shares, including to enhance our visibility and our brand image among our existing and potential customers and to create a public market for our equity shares in India,” the DRHP said. 

From the net proceeds of the IPO, the airline plans to pay over Rs 2,015.81 crore towards prepayment or scheduled repayment of all or a portion of certain outstanding borrowings.