Mumbai: Deccan Aviation Ltd, which runs first budget carrier Air Deccan, said it has set a price band of Rs 150-175 a share for its initial public offer set to open on May 18.
The airline plans to use the funds for debt repayment and infrastructure development, its founder G R Gopinath said on Tuesday.
The offer to sell 24.55 million shares, accounting for a fourth of the company's post-issue capital, could raise about $95.7 million at the top end of the price band.
"We believe the IPO pricing offers a fair value for our prospective shareholders. Air Deccan, which had planned to allot shares to a handful of investors ahead of the public issue to help set a benchmark for the price band, had dropped the plan as it could not seal the deal on time," he said.
"Had we waited, we would have had to postpone the IPO," Gopinath added. The carrier had already postponed its IPO from March to May due to lack of time to market its offer.
Air Deccan, which started operations in 2003, offers no-frills travel on 260 flights a day covering 56 cities. It flies 14 Airbus jets and 21 ATR turboprop planes now.
The airline, which flew about 3 million passengers in 2005/06, aims to more than double that number to around 7.5 million passengers in the current year.
Air Deccan, which has already placed orders for 100 more aircraft to be delivered over the next 90 months, would have a fleet of 45 by March 2007, Gopinath said.
Shares of rival listed airlines have lost ground since the start of the year. With Jet Airways Ltd. losing 16.2 per cent and SpiceJet Ltd. falling 7.8 per cent compared with a 32.6 per cent gain by the benchmark BSE index.
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