Indigo co-founder stake sale: Five big questions on Rakesh Gangwal strategy

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26 Aug, 2025 12:21

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In a major development at the largest airline in the country IndiGo, co-founder Rakesh Gangwal (he has been a shareholder for more than 15 years) has stepped down from the firm’s board of directors. The move comes days after the other co-founder Rahul Bhatia, took over as the airlines’ Managing Director with immediate effect for a five-year term. Remember, both the co-founders have been embroiled in an extended spat over alleged corporate governance lapses.

But what triggered Gangwal’s announcement and what’s the road ahead? Will he face any roadblocks? We break it down for you by answering 5 key questions

 1)   How much stake does Rakesh Gangwal hold in InterGlobe Enterprises (parent firm of IndiGo Airlines)?

According to the latest stock exchange filings, the promoter group owns 74.78 percent stake in InterGlobe Enterprises. Out of this, the Gangwal family (Rakesh Gangwal, his wife Shobha Gangwal and a related trust -The Chinkerpoo Family Trust) own 36.61 percent stake. The remaining is held by the Bhatia family.

Also read: Read the full text of Rakesh Gangwal on his resignation from IndiGo board

2)   What is the current value of the combined stake of the Gangwal family in InterGlobe Enterprises?

The market cap of the firm at the end of days trade on February 18 stood at Rs 81, 672 crore. So 36.61 percent of that would translate into nearly Rs 30,000 crore (Rs 29,900 crore). In the last six months, the firm’s stock has risen by nearly 20 percent from Rs 1,697.7/share to Rs 2,120/share. Recently, the airline reported a quarterly profit after a gap of seven quarters or nearly two years.

3)   Will the proposed stake sale by Gangwal over five years face a RoFR hurdle?

No. The right of first refusal (RoFR) clause was removed by IndiGo shareholders at an EGM held in December 2021. This will allow each of the promoter groups (Bhatia and Gangwal) to sell or transfer their shares to a third party without first giving each other notice.

4)   Is it mandatory for a director who is also a co-promoter and a co-founder to step down from the board prior to a proposed share sale?

 According to corporate law experts Moneycontrol spoke to, there is no such requirement. They believe Gangwal’s move may be one of abundant caution and transparency to avoid any allegations of insider trading at the time of sale of shares or any perception that he was aware of something not available in public domain while conducting the transaction/s.

By stepping down as a director, he does not want any access to UPSI (unpublished price sensitive information) and he has also explicitly told the board not to share any company information with him that falls under UPSI. And it is all now in public domain. The move also gives him greater flexibility as he looks to “slowly reduce” his equity stake in the company over the next five plus years. The messaging of gradual reduction of stake over a long time frame will also avoid any panic among retail shareholders, according to experts.

5)   Will Gangwal make a comeback or is this goodbye IndiGo?

The jury is out on this one as Gangwal has left the door slightly ajar for an entry at a later stage if required. “Sometime in the future I shall consider participating again as a board member, “is the mysterious ending to his letter addressed to the members of the board. So it is unclear if he would return or not as a director on the board after pocketing some winnings of the table. As he himself points out in the initial part of the letter, “Like any plan, future events may impact my current thinking.”

Since it’s a voluntary move, and there is no dismissal or disqualification, nothing under the Companies Act bars Gangwal from returning as a director on Indigo’s board, unless the move is blocked by the board of shareholders.