Shares of IndiGo fell 17 per cent during early trade on Wednesday after the dispute between its promoters came out in the open. At 9.47 a.m., the budget passenger carrier was trading at Rs 1,379.65 apiece, down by Rs 186.10 before hitting an intra-day low of Rs 1,291.
Airline co-promoter and former US Airways Chief Executive and Chairman Rakesh Gangwal came on record to lodge his grievances against various issues pertaining to IndiGo.
In his letter to Securities and Exchange Board of India (Sebi) Chairman Ajay Tyagi and other top officials, Gangwal lamented that IndiGo has started veering off from the core principles and values of governance that made IndiGo what it is today.
He raised serious objections to related party transactions in the company, stating that various fundamental governance norms and laws were not being adhered to. He warned that this will lead to unfortunate outcomes if effective measures are not taken.
Gangwal has sought regulatory intervention from market regulator Sebi to resolve the issues. He, along with his affiliates, hold 37 per cent stake in IndiGo while the other co-promoter, Rahul Bhatia, has 38 per cent equity stake.
Sebi has sought a response from IndiGo on the alleged grievances raised by Gangwal.
IndiGo in its BSE regulatory filing said: "... We inform you that the Board of Directors of lnterGlobe Aviation Limited has received a letter dated July 8, 2019 from Rakesh Gangwal, the copy of which is already with the Stock Exchanges, informing the company that he has written a letter to Sebi seeking regulatory intervention on his alleged grievances".
"Sebi has in the meantime asked the company to give its response to this letter by July 19, 2019, with which the company will comply."