Covid-19: IndiGo can raise Rs 3,000 crore to Rs 5,000 crore by leasing assets, says CEO

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IndiGo Chief Executive Officer Rono Dutta told CNBC TV18 in an interview on Monday that the private airline can raise Rs 3,000 crore to Rs 5,000 crore by leasing its owned assets, including aircraft and engines. Airline revenues have been severely hit after they were shut down during a national lockdown to combat the coronavirus pandemic. Only some flights were restarted from May 25.

“We own some aircraft, some ATRs, a lot of engines, some A320s,” he said. “We are putting them back on lease. That will give us Rs 3,000-5,000 crore of funding. I am quite optimistic about prospects of IndiGo.”

Dutta said the airline plans to focus on the efficiency of aircraft in use, so as to reduce costs. It is also negotiating agreements with suppliers for lower costs. The airline is currently operating at 30% capacity.

“Our relationship with lessors is a key success factor,” Dutta said. “We are working with lessors. We are paying all our bills. We are trying to reach an amicable solution with lessors. We are negotiating terms of new planes with lessors.”

The chief executive officer also said that IndiGo will purchase around 120 fuel-efficient neo aircraft over the next two years and will simultaneously retire nearly 120 A320s. Therefore, the airline capacity…

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