1.

COMPANY BACKGROUND

Indian low-cost carrier InterGlobe Aviation Ltd., operating as IndiGo, has its
headquarters in Gurgaon, Haryana. Rahul Bhatia of InterGlobe Enterprises and Rakesh
Gangwal established the airline as a private business in 2006. At the moment, IndiGo
offers flights to 50 locations, connecting 42 domestic and 8 foreign destinations. On
January 13, 2004, InterGlobe Aviation was initially registered in Lucknow as a private
limited company under the Companies Act 1956 with the Registrar of Companies for
Uttar Pradesh and Uttaranchal in Kanpur. Pursuant to a special resolution of the
shareholders of the Company on June 30 2006 the Company was converted into a public
company and the name of the Company was changed to 'InterGlobe Aviation Limited'
subsequent to which a fresh certificate of incorporation was issued by the Registrar of
Companies National Capital Territory of Delhi and Haryana on August 11 2006.

In June 2005 InterGlobe Aviation placed a landmark order of 100 A320 aircraft with
Airbus. In July 2006, it received its first aircraft, and a month later it began flying. As of
today, it has a fleet of 279 aircraft. It ranks among the most dependable airlines in the
world because to a standardised fleet for every type of operation, great operational
reliability. It places a strong emphasis on three pillars: providing affordable fares, being
on time, and providing a hassle-free service. IndiGo reached one million passengers in
April 2007. The airline passed the 10-million-passenger threshold in April 2009. IndiGo
began operating internationally in September 2011. Flights from New Delhi and Mumbai
to Bangkok, Singapore, Muscat, and Kathmandu were added to the international service
offerings. Many cities, including Bangalore, Chennai, Kochi, Kolkata, Kozhikode,
Thiruvananthapuram, and Visakhapatnam, now provide international flights as well.
Additionally, during the month, it surpassed other domestic carriers in India in terms of
market share.

By passenger market share, the airline surpassed all others in India in 2012. In November
2015, the business went public. For the ninth year running, IndiGo took home the 'Best
Low-Cost Airline in Central Asia & India' award at the Skytrax World Airline Awards.
As of August 2022, IndiGo had a market share of 57.7%, making it the largest passenger
airline in India. As a low-cost carrier, it primarily serves the domestic air travel market in
India.  There haven't been any deadly incidents involving IndiGo planes thus far.
 2. COMPANY MANAGEMENT

As per 2021, IndiGo has 23,711 employees in its company. M. Damodaran is currently
designated as the Chairman of the Company and Pieter Elbers is appointed as the CEO of
the Company since 2022. IndiGo has a group of Directors who are sincerely committed to
the Company and have been serving the company since decades. Rahul Bhatia is the
Promoter and Managing Director of the Company.

Interglobe Aviation Limited is publicly traded under NSE: INDIGO, with a market
capitalization. The Company has a management which focuses on the global document
management and business services. It also focuses on the commercial operations, network
planning and marketing and sales.

The management works in such a way that all the activities are divided into task groups
with professionals and experts. IndiGo coordinates operations in all its units across the
world to ensure the smooth running of its airlines. Most of the purchasing activities are
done centrally so as to minimise the cost and ensure the uniformity. This structure
coordinates and motivates the employees so that they work together to achieve goals.

Long Term Borrowings

What % of total assets in funded by long term debt?
66% of the total assets are funded by the long term debt borrowings.
Did the company raise additional/repay existing long term debt during the year?
Yes Indigo raised Rs. 4500 Crore.
What were the specific reasons for additional borrowing during the year?
Indigo wanted to enter into sale and leaseback arrangement for new aircrafts as it
expected further revenue deterioration and cash burn.
What is the average cost of these borrowings?
An additional interest amount of 4.5% to 6.5% is the borrowing cost.
What is the interest coverage ratio?
Interest Coverage Ratio is -1.58
Are operating cash flows sufficient to meet interest & principal obligations?
No they are not sufficient, loan and interests amounts are way higher than the cash flows
Stakeholders:
In the financial year 2021-22 385.25 Crore rupees capital was issued, 385,254,729 shares
were issued at the par value of 10 rupees. The shares were issued to the general public on
stock market. The co-promoters have sold 2.7% of their stake for 2005 crore rupees in
September,2022. The share holding pattern at Indigo is:
Holder's Name Number of Shares % Share Holding
Number of shares 385254729 100%

Promoters 147052767 38.17%

Foreign Institutions 64401529 16.72%

Banks and mutual funds 17656842 4.58%

Others 2720802 0.71%

General Public 5490550 1.43%

Financial Institutions 6937333 1.8%

Foreign promoters 140994906 36.6%

The promoter’s shareholding in the company can be used to raise funds and acts as a security,
it is known as pledged shares. The promoters of the company have not pledged their
shareholding as securities to raise working capital or venture funds. Indigo is listed on
National Stock Exchange of India Limited and The Stock Exchange, Mumbai; both are the
largest exchange in Indian Market. For the financial year 2021-2022, the highest price of
Indigo’s share was 2380 rupees and the lowest share price was 1,511.75 rupees. The book
value of the shares are -155.84 rupees. Book value can be used to calculate price to book ratio
where it is compared to the current market price of the share, the price to book ratio is -11.28
for Indigo. The Nifty 100 gave a return of 50.87% whereas the Stock gave a return of
16.55%. The latest AGM was held on 26/08/2022 and the agenda was to appoint two new
directors and to get approval to appoint Anil Parashar as a Director for the second time and
Meleveetil Damodaran as a Non-Independent Non-Executive Director. Approval will be
taken to appoint retired Air Chief Marshall Birender Singh Dhanoa and former Shell Group
of Companies in India Chairman Vikram Singh Mehta as independent directors. Indigo did
not paid any dividend for the year 2021-2022.

Auditors:

Ernst & Young was the auditor for Indigo for the fiscal year 2021-22. Auditors report
suggested possible effects of COVID-19 pandemic on Indigo’s functioning and operations.
Standalone financial statements were audited for the year ending 31st March,2022. The audit
report included passenger revenue, lease accounting (for the used and new aircrafts) , tax,
aircraft maintenance, impact of COVID-19 on financial assets.

Ratio Analysis
Earnings Per Share (Rs) -159.94
Cash EPS(Rs) -28.38
Dividend Per Share(Rs) 0
Book NAV/Share(Rs) -156.69
Tax Rate(%) -0.13
Margin Ratios
Core EBITDA Margin(%) 2.22
EBIT Margin(%) -14.53
Pre Tax Margin(%) -23.73
PAT Margin (%) -23.76
Cash Profit Margin (%) -4.22
Performance Ratios
ROA(%) -13.43
ROE(%) 0
ROCE(%) -1,434.91
Asset Turnover(x) 0.57
Sales/Fixed Asset(x) 0.85
Working Capital/Sales(x) -11.85
Efficiency Ratios
Fixed Capital/Sales(x) 1.18
Receivable days 3.88
Inventory Days 5.1
Payable days 7,369.81
Valuation Parameters
PE Ratio(x) 0
Price/Cash EPS(x) -70.95
Price/Book(x) -12.85
Dividend Yield(%) 0
EV/Net Sales(x) 2.75
EV/Core EBITDA(x) 54.84
EV/EBIT(x) -18.93
EV/CE(x) 1.54
M Cap / Sales 2.99
Growth Ratio
Net Sales Growth(%) 77.12
Core EBITDA Growth(%) 23.75
EBIT Growth(%) -3.28
PAT Growth(%) -6.12
EPS Growth(%) -6.03
Financial Stability Ratios
Total Debt/Equity(x) -0.65
Current Ratio(x) 0.9
Quick Ratio(x) 0.88
Interest Cover(x) -1.58
Total Debt/Mcap(x) 0.05
Non-Current Assets
1} What is the total investment in non-current assets as % of total assets?
Non-current assets = 2,57,130.18
Total assets = 4,58,601.06

Non-current assets as % of total assets = 56.068 %

2} What the return on total assets?

Total assets = 4,58,601.06
Net Income = (61,710.25)

ROA = Net Income/ Total assets = (-0.134)

3} What is composition of tangible & intangible assets?

Tangible assets = 21,262.10
In Tangible assets = 21.56

4} Has the company recognized any impairment losses?

An outbreak of a communicable disease (as with the pandemic) across the globe causes
air travel to inevitably become the focus of much attention due to the potential for
unrestricted movement of people to increase infection rates. Global and national efforts to
limit the spread of any pandemic can result in disrupted operations, which can potentially
lead to erosion of our reputation and also decrease in demand for travel. The adverse
impacts of Covid-19, or possible outbreaks of any other pandemic or similar public health
threat in the future can significantly affect our operations and result in financial losses.
The Company has incurred cash losses amounting to Rs. 2,991 million in the current year
and amounting to Rs.18,563 million in the immediately preceding financial year.
Financial assets at amortised cost These assets are subsequently measured at amortised
cost using the effective interest method. The amortised cost is reduced by impairment
losses, if any. Interest income and impairment are recognised in the Standalone Statement
of Profit and Loss. Financial assets at FVTPL These assets are subsequently measured at
fair value. Net gains and losses, including any interest income, are recognised in the
Standalone Statement of Profit and Loss.

5} Has the company revalued any of its fixed assets during the year?
The Company has not revalued its Property, Plant and Equipment (including Right of use
assets) or intangible assets during the year ended March 31, 2022.

6} What is the depreciation as % of total revenues?

Depreciation = 50,678.47
Total revenues = 266,554.69

Depreciation as % of total revenues = 19.012 %

Revenues & Income
1} What is the growth in revenues?
Revenue for the year 2022 = 266,554.69
Revenue for the year 2022 = 156,769.63

Growth in revenue = 109,785.0

Other investments

Q1 What kind of investments has the company made? How much is trading purposes?

The total investment that the company made during the financial year 2021–2022 as an
investment in the non–current asset is 0.12 million rupees. 7670 million is designated in the
current asset section as an investment for the years 2021–2022.

Q2 How much income did the company get during the year from its investments?

Throughout the year, INR 42574 was made from mutual funds, shares, and fixed-rate non-
convertible debentures.

Q3 What kind of contingent liabilities does the firm have? How much are these as % of
current revenues/operating cash flows?

Contingent liabilities are possible obligations that arise from past events and whose existence
will only be confirmed by the occurrence or non-occurrence of one or more uncertain future
events not wholly within the control of the Company. Where it is not probable that an
outflow of economic benefits will be required, or the amount cannot be estimated reliably, the
obligation is disclosed as a contingent liability, unless the probability of an outflow of
economic benefits is remote.
Q4 What is the nature of the extraordinary gains/losses?

There are no extraordinary gains/losses noted in the financial report for 2021-2022.

Q5 What is the effective tax rate?

According to the part on the reconciliation of the effective tax rate in Indigo Airlines'
financial statement, the effective tax rate was 25.168%.

Q6 What are the major reasons for the current profits increasing/decreasing as compared to
the previous year?

The largest category of expenditure that saw a significant increase in the fiscal year 2021–
2022 compared to the year prior, 2020–2021, is airline fuel expense. According to reports, the
fuel expense for the fiscal year 2022 was reported to be 96952.36 million rupees, up 153.2
percent from the previous year's reported figure of 38312.77 million rupees.

Q7 Is the company generating sufficient cash from its operating activities? What are the
major reasons for the differences between operating profits and cash flows?

Yes, the company is generating enough cash to support the operating activities i.e
INR 20905.78 million, however, the generated cash from operating activities is used to pay
off lease liability, and its interest in addition to that it is generally used to pay off debts that
the company had financed earlier.

Q8 Are any operations discontinued? Impact thereof?

The company has discontinued food service on a flight less than 2 hours as stagged services
were not practical on these flights due to short flight duration as reported in the company’s
financial statement report 2022.

Q9 Any M & A or other similar activities?

No instances of M & A and other similar activities have been recorded as Indigo is an airline
service company and it doesn’t have any plans to become a conglomerate as of now.
CSR

Q1 What is ESG? What are the focus areas of ESG?

ESG (Environmental, social, and corporate governance) is an umbrella term that refers to
specific data designed to be used by investors for evaluating the material risk that the
organization is taking on based on the externalities it is generating. At IndiGo, our ESG
strategy comprises three focus areas — Environment, Social, Business and Governance.
These focus areas serve as the pillars of our strategy and all our material topics are grouped
under these pillars. The three pillars and their respective material topics have been displayed
in the diagram below:

Q2 Is the entity required to comply with guidelines for CSR spending?

InterGlobe Aviation Limited (“IndiGo” or the “Company”) as an organization has time and
again stood up and contributed in every possible way to fulfill its commitment as a
responsible corporate. Though this Policy has been formulated and adopted in compliance
with the provisions of the Companies Act, 2013, as amended (the “Act”) read with the
Companies (Corporate Social Responsibility Policy) Rules, 2014, as amended (the “CSR
Rules”) to undertake all or any of the activities as set out in Schedule VII of the Act, IndiGo
right from its inception has consistently made efforts and is continuing to make efforts
towards reaching out to the less privileged sections of society and contributing towards their
betterment.

Q3 How much was allocated for CSR & what was actual spending?

The CSR budget will be allocated and utilized in compliance with the provisions of the Act
and the CSR Rules. The Board shall ensure that administrative overheads are within the limit
as prescribed under the CSR Rules. For the sake of clarity, if any surplus funds are generated
by a Project or activity including interest on the initial CSR funds provided by IndiGo, such
surplus funds shall not form part of the business profit of the Company and shall be utilized
as per the CSR Rules. Additionally, unspent amounts shall also be dealt with by the Act and
the CSR Rules.
Under Section 135 of the Companies Act, 2013, the Group is required to spend, in every
financial year, at least 2% of the average net profits of the Group made during the three
immediately preceding financial years on Corporate Social Responsibility (CSR), under its
policy in this regard.

Q4 What are the focus areas of CSR spending?

IndiGoReach is the CSR arm of the Company through which programs and processes are
implemented to contribute towards the goal of sustainable development for our communities.