IndiGo's IPO Demand Exceeds $460 Million Offer Size by 6 Times

  • Institutional investors bid at 16 times reserved shares
  • Retail investors bid for only 32% of allocated stock

A planned $460 million share sale by InterGlobe Aviation Ltd., owner of India’s largest carrier IndiGo, got bids that were more than 6 times the issue size as the nation’s biggest initial public offering in almost three years was set to close Thursday.

Institutional investors subscribed to about 16 times the shares reserved for them, while retail investors bid for only 32 percent of the stock allocated to them as of 7:51 p.m. in Mumbai on the third and final day of the sale, according to the National Stock Exchange.

InterGlobe Aviation and its existing investors are seeking to raise as much as 30.01 billion rupees ($460 million), according to terms for the deal obtained by Bloomberg on Oct. 27. At the top end of its proposed range of 700 rupees to 765 rupees a share, the IPO would value the airline at about 276 billion rupees. That would make IndiGo the third-largest budget carrier in the Asia-Pacific region, according to data compiled by Bloomberg.

The share sale, the first by an Indian airline since 2006, will allow IndiGo to build its fleet in one of the world’s fastest growing aviation markets. The IPO is India’s largest since Bharti Infratel Ltd.’s December 2012 offering.

Initial public offerings in the South Asian nation have raised 77.4 billion rupees this year, up sixfold from the same period in 2014 for the largest volume in five years, data compiled by Bloomberg show. Coffee Day Enterprises Ltd., which closed its IPO on Oct. 16, raised 11.5 billion rupees, drawing a demand of 182 percent for the shares offered.

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