Lenders led by Central Bank of India will auction a 95-acre land parcel in Thane on August 20 to recover dues from the defunct Go First airline. The property has a reserve price of ₹1,375 crore, part of efforts to recoup over ₹3,918 crore in outstanding debt.
A consortium of lenders, including Central Bank of India, Bank of Baroda, and IDBI Bank, has set an auction date for a 95-acre land parcel owned by Wadia Realty Pvt Ltd. The property, located in Bhayanderpada on Ghodbunder Road in Thane, serves as collateral for loans previously extended to Go Airlines (India) Ltd, which operated as Go First.
Auction and Recovery Targets
The auction is scheduled to take place on August 20, 2026, under the SARFAESI Act, a law that allows financial institutions to auction residential or commercial properties to recover non-performing assets. The reserve price for this land parcel has been set at ₹1,375 crore. This sale is a key step in the lenders' process to recover a total of ₹3,918.55 crore in dues, which includes both principal and interest amounts calculated as of August 31, 2023.
Context of the Airline Collapse
Go First, part of the Wadia Group, suspended its flight operations in May 2023. The airline’s collapse followed prolonged financial pressure, largely attributed to issues with its Airbus A320 Neo fleet and recurring shortages of Pratt & Whitney engines. The company had initially attempted to reduce its debt burden through a planned initial public offering in 2021, aiming to raise approximately ₹3,600 crore. However, the plan was shelved due to challenging market conditions and the airline’s mounting financial stress.
Following the suspension of services, the airline entered insolvency proceedings. After nearly two years of attempts to find a buyer or a resolution plan failed, the Committee of Creditors voted to move toward the liquidation of the airline's assets. The total debt owed by the airline to its lenders stood at approximately ₹6,521 crore.
Investor Monitorables
For market participants, the primary focus remains on the success of this land auction. The recovery of ₹1,375 crore through this sale would significantly impact the overall debt resolution for the consortium of banks involved. Investors may track the auction results on August 20 to see if the property attracts bidders at the set reserve price, as this will provide clarity on the actual recovery value for the banks. Future updates regarding the sale of other remaining assets of the airline will also be important to watch as the liquidation process continues.