Interglobe Aviation or IndiGo shares fell nearly 5% on Thursday after the airline's co-founder Rahul Bhatia moved for arbitration proceedings amid differences with co-promoter Rakesh Gangwal on shareholders' agreement and articles of association.
With a gap-down chart pattern, the Indigo stock opened 3.31% lower at Rs 1,809.00, against the previous close of Rs 1,870.85. Later, the Indigo stock fell 4.95% to the intraday low of Rs 1,778.25. The stock has lost over 3% of its value in the last 3 days of a bearish trend.
Currently, the stock trades higher than its 20, 50, 100 and 200-day moving averages but lower than 5-day moving averages. However, the Indigo stock trades a mere 4.4% away from a 52-week high of Rs 1,911
InterGlobe Aviation informed stock exchanges on Tuesday that Rahul Bhatia and his group InterGlobe Enterprises submitted a request for arbitration on 1 October to the London Court of International Arbitration.
"The agreement was executed between the IGE Group, Rakesh Gangwal, The Chinkerpoo Family Trust, Shobha Gangwal (together with Gangwal and The Chinkerpoo Family Trust, the "RG Group") and InterGlobe Aviation Limited (the "Company")," the filing said.
This dispute relates to claims of the IGE Group against the RG Group regarding, inter-alia, compliance with the shareholder's agreement and the articles of the association of the company and damages.
IndiGo also clarified that the arbitration request has not sought any relief against the company.
"However, presently, no monetary claim, including any compensation or penalty, has been sought against the company," it also said.
The allegations submitted were rejected by Bhatia group, PTI reported.
Bringing the differences between long-time friends and promoters of IndiGo into open, Gangwal, in July, had sought Sebi's intervention in alleged corporate governance lapses in the company.
As of March 31, the two promoters hold 74.93% stake, with Bhatia and his associates holding 38.26% stake, followed by Gangwal and his associates at 36.68%. The rest 25.07% stake is held by the public.
(With agency inputs)