IPO delayed due to Ukraine-Russia war and Omicron wave: Go First

The firm's DRHP expired in August this year and it will need to refile its papers with Sebi to reinitiate the IPO process

Go First said its initial public offering (IPO) to raise Rs 3,600 crore was delayed due to the Omicron wave’s “severe” impact on international travel and the “unexpected” Russia-Ukraine war, according to its regulatory filings last week.

“Based on the market prospects, the company would reinitiate the IPO process in consultation with the Book Running Lead Managers,” the airline — owned by the Wadia Group — stated.

Go First’s filings were done a few days before Friday’s Sebi order that barred its promoters from accessing the capital markets. Business Standard has reviewed the filings.

The Securities and Exchange Board of India (Sebi) — in its order dated October 21, 2022 — barred Bombay Dyeing and Manufacturing Company (BDMCL) promoters Nusli Wadia, and sons Ness and Jehangir Wadia from accessing the capital markets for two years for allegedly misrepresenting the financial statements. 

Go First had in May 2021 filed the draft red herring prospectus (DRHP), wherein it said it wants to raise Rs 3,600 crore via fresh issue of shares. The primary portion of the money raised will be used to clear dues with banks, vendors and aircraft lessors. In August 2021, the airline’s IPO received the approval of the SEBI.

The DRHP expired in August this year as the airline did not hit the public markets within one year period of the Sebi’s approval. The airline will now need to refile its papers with the SEBI to reinitiate the IPO process.

In its filings last week, Go First said: “Although, the Company was in the receipt of the Sebi approval (in August 2021), owing to the Omicron wave and its severe impact on the international travel and also the unexpected war between Ukraine and Russia and as advised by the merchant bankers, the company did not proceed with the IPO as per the planned schedule.”

Go First spokesperson did not respond to Business Standard’s query on what market prospects the airline is looking for and how is the current market not suitable for its IPO. Go First carried 815,000 passengers on domestic flights in September, giving it a market share of 7.9 per cent, according to the Directorate General of Civil Aviation.